The Director-General of the World Trade Organization, Ngozi Okonjo-Iweala, mentioned in an interview with Nikkei Asia that she hopes to push for reforms in two aspects. One is to standardize the definition of “developing country” status for member countries, and the other is to determine the scope of “national security exceptions.”
Okonjo-Iweala explained that unlike other organizations such as the International Monetary Fund and the World Bank, the WTO does not have a clear definition for developing economies. In other words, member countries can self-designate themselves as either developing or developed countries.
She stated that this allows some countries to continue to enjoy special and differential treatment, exempting them from certain provisions in agreements or extending the time to comply with agreements.
As part of the reform, she suggested considering at which per capita GDP level countries no longer need assistance and which countries can implement measures independently without special treatment.
President Trump has criticized China for utilizing its “developing country” status unfairly despite its massive economic size.
Okonjo-Iweala did not directly name China. In contrast, Taiwan, which joined the WTO a year after China, has relinquished its self-designation as a “developing country” and now participates in WTO activities and responsibilities as a “developed country.”
“The most important thing is the criteria for receiving special treatment, rather than self-identifying as a developing or developed country,” Okonjo-Iweala added. “These are merely titles.”
She also mentioned the need for member countries to determine what truly constitutes a national security exception.
“I believe this is a very complex issue that member countries must address within the context of reforming the dispute settlement mechanism,” she stated.
During his first term, President Trump blocked the appointment of judges to the Appellate Body responsible for adjudicating trade disputes, partially crippling the WTO’s dispute settlement mechanism.
Okonjo-Iweala emphasized that reform must be conducted in cooperation with the United States and acknowledged that while the dispute settlement mechanism is currently facing a crisis, it also presents opportunities.
This enables the organization to address some underlying issues that have not been tackled yet, such as criticisms of unfair trade practices and inadequacies in defining developing countries.
Currently, the Trump administration has imposed a 10% global tariff on all trade partners, citing security reasons, and has imposed additional tariffs on China.