Is global trade moving back to bilateralism?
The WTO, the UN, the WHO, the World Bank, the European Union, NAFTA, CAFTA. All of these acronyms and names are well-known worldwide. What is not known about them is that the organizations behind those names were created with the single purpose of consolidating a centralized global power in the hands of unelected bureaucrats.
As these organizations became stronger in the world of politics, national sovereignty shrank rapidly. Countries were grouped according to their location on the planet or classified taking into account their level of development, GDP, international influence and military power, among others.
The role of supranational organizations such as the ones cited before was to create policies on trade, the environment, health, finance, and immigration so that those issues would be governed from corporate-sponsored boardrooms in North America, Asia and Europe, while giving the appearance of being democratic, virtuous goals that were implemented for the good of humanity.
Instead, they sought to advance the interests of globalist corporations that had been sponsoring policies and politicians in the shadows for decades. In a sense, the creation of international organizations allowed corporations and their political puppets to sort of legitimize their activity and to bring it to the open in the name of… whatever they wanted to say.
Nationalism to the rescue
The rise of Nationalism, different from what we all hear on mainstream media, is a direct threat to the globalist project, not to human rights, democracy or anything of the sort, as it is painted by defenders of international institutions and the international order that governed the planet for a long time.
It is common to read and hear so-called experts explain how the rebirth of Nationalism represents a threat to the international order, which is the only thing the western world knows as an ‘order’. It is natural for them to say so, because their lives and livelihoods depend on that order advancing on all of us. It is in their interests for a global order to take deeper roots and to become invincible before national interests.
Fortunately, Nationalism took a big leap forward with the appearance of parties and popular movements in Europe, the United States and Latin America. The surge of anti-EU parties began in the UK, via UKIP.
The rise of Nationalism continued in France with the National Front and later crossed the Atlantic Ocean to arrive in the United States. In 2016, Donald Trump was elected 45th president and with it most globalist organizations were targeted for their overreach. A few months later, Brazil elected Jair Bolsonaro, a conservative politician who adopted a Brazil First policy.
Going back to Bilateral and Trilateral Negotiations
The latest victim of Nationalism is the World Trade Organization (WTO).
The United States has been trying to do away with globalist organizations such as the WTO from within. After about three years under the presidency of Donald Trump, the threat seems more real than ever.
Sources consulted fear that this is the beginning of the end of a multilateral order in international trade, which might be replaced by a system of negotiation between countries, in which the two large blocks, the US and China would impose their conditions on others.
The European Union has been trying for months to push for a reform that, in addition to satisfying the Americans, manages to adapt the WTO, the body that replaced the GATT (General Agreement on Tariffs and Trade) scheme for the digital age. It would be necessary to make it more agile in matters such as intellectual property, investment protection rights or electronic commerce.
“The WTO was clearly not designed to accommodate planned economies like China, with a strong weight of the state in production,” admits from Hong Kong Alicia García Herrero, chief economist of Natixis for Asia-Pacific.
“The current situation is very disappointing. It is too early to know if our attempt to reform the body will succeed, but we have to prepare ourselves for a situation in which the Appellate Body stops working”.
Given the difficulties in agreeing to reform the 164-member organization, Brussels tries to promote a kind of parallel WTO in which the United States does not participate.
This new route of arbitration, to which countries such as Japan, India, Russia or South Africa have already shown their support for, would be a temporary mechanism waiting for the real WTO to be operational again.
There is already a critical mass that supports this parallel system. Many countries have concerns about how the WTO works, but not to the point of blocking it. In that body, the smallest partners raise cases on equal terms.
It is the only way to protect oneself from the arbitrariness of the big ones, but the WTO has not done that. The attempt to create a parallel system does not mean that the EU has renounced WTO reform.
“We cannot guarantee the success of the reform. So, we have started ways to protect our legal interests in disputed cases,” say European representatives.
The problems of the WTO are not new. Previous US administrations had already harshly criticized the Appellate Body on the grounds that it exceeded its mandate and that it ruled too often against US interests.
In reality, though, it ruled against national interests as it favored international corporations. It was after the arrival of Donald Trump when the White House threatened to ignore the decisions made by the WTO.
Washington considers that the WTO exceeds its functions and invades its national sovereignty. Meanwhile, Brussels has also to look for a plan b, which would be the search for bilateral agreements if the world breaks into two blocks.
A good occasion to ponder the loss of power of the WTO is the meeting of the in Osaka, Japan. The world will be expecting the final communiqué by the US.
Sources consider it unlikely that the US will agree to abide by WTO rules. It seems that the organism is going to be increasingly irrelevant, as China could be scared to see its economy slow down without a favorable forum to get its cases heard.