With 164 member states representing 98% of global trade and global GDP, the World Trade Organization (WTO) is the world’s largest economic and trade organization. Established in 1995 as a successor to the General Agreement on Trade and Tariffs (GATT) which was straining to adapt to a globalized world economy that was emerging at the turn of the century.
With the headquarters in Geneva, Switzerland the primary objective of the organization is to regulate and facilitate international trade. The WTO sets the ground rules for trade in goods, services, and intellectual property among member countries by providing a framework for negotiating trade agreements that usually encourage reducing or eliminating tariffs, quotas, and other trade restrictions to promote international trade.
Incidentally, the establishment of the WTO coincided with the Internet and Communication Technology (ICT) revolution which has since changed the world into a global village with vast implications for international trade. With the ICT revolution (digital age), trade barriers have been reduced, trade volumes have increased, productivity has increased and economic growth has been enhanced, which all aligns with the goals and objectives of the WTO.
However, with the increased volume of trade brought about by the digital age came new challenges as there were inadequate legal and regulatory frameworks to facilitate trade in the fast-evolving digital economy and there was also unequal access to digital markets across the globe.
In response to rapid changes in the way international trade transactions were being executed as a result of the digital economy, the WTO started discussions on how trade should be redefined for the digital era that we are in. At the 14th ministerial conference of WTO member countries held in 2022, they also agreed to renew a moratorium on customs duties on electronic transmissions which had been in place since 1988 to ensure that online transactions and digital trade will continue to be free from tariffs and other trade barriers and thus promote the growth of e-commerce and digital trade globally.
The WTO also provides Trade-Related Technical Assistance (TRTA) to help developing countries build their trade capacity while they also support initiatives designed to assist developing and developed countries alike through the Enhanced Integrated Framework (EIF) and the Standards and Trade Development Facility (STDF).
In furtherance of their objectives to promote international trade, the WTO in 2021 appointed Dr. Ngozi Okonjo-Iweala as its Director General to pilot the affairs of the organization. Given her pedigree as a development economist and international trade expert who had risen to the position of Managing Director of the World Bank after two very successful tenors as minister of Finance in her home country Nigeria, she was certainly best suited for the job.
Starting her tenor as Director General at a time when the whole world was still trying to recover from disruptions caused by the COVID-19 pandemic, she played a key role in shaping WTO’s response to the impact that the pandemic had on global trade. She also used her office to advocate for a more equitable distribution of vaccines and medical supplies while pushing for a waiver on intellectual property rights for COVID-19 vaccines to increase access to the developing world.
She has also made efforts to reform the WTO and improve its dispute settlement process while working to increase the participation of women and other underrepresented groups in trade and economic policy decision-making. By fostering cooperation between the WTO and other international organizations to address global challenges, she has demonstrated exemplary leadership skills which has helped to strengthen the WTO’s role in promoting a more inclusive and sustainable global trading system.
As the rapidly evolving digital age continues to change and shape the way we do business locally and internationally, the WTO would have a key role to play as they continue to tweak their rules and regulations to facilitate and boost international trade as they continue to seek ways to eliminate trade barriers to help create global wealth.
Oshobi, a development economist, management consultant, and author writes from Lagos, Nigeria.