Trump Trade Representative Attacks WTO for 'Losing Focus'
December 11 2017 - 01:09PM
Dow Jones News
By Jacob M. Schlesinger
President Donald Trump's chief trade adviser issued his first
detailed criticism of the World Trade Organization Monday, blasting
the global commercial arbiter for "losing its essential focus" and
becoming "a litigation-centered organization" that has failed to
pay sufficient attention to enforcing existing rules.
While U.S. Trade Representative Robert Lighthizer didn't mention
China by name, he made Beijing a clear target in his speech to
fellow trade ministers of the 164-member body at its biannual
meeting this week in Argentina.
Mr. Lighthizer said he felt the Geneva-based organization needed
to focus its agenda on Chinese economic practices that critics
often blame for giving the country unfair advantages and for
prompting its companies to flood global markets with cheap exports.
WTO rule-making committees, Mr. Lighthizer said, should tackle new
challenges such as "chronic overcapacity and the influence of
state-owned enterprises."
Messrs. Lighthizer and Trump have both long been critics of the
WTO, accusing it of treating the U.S. unfairly in many legal cases,
for infringing on American sovereignty, and for failing to address
the challenges from China's hybrid communist-capitalist
mercantilist system.
But the two have so far said very little about how, if at all,
the U.S. would translate that disaffection into a new American
policy toward the WTO, which enjoyed stronger support from Mr.
Trump's predecessors.
Mr. Lighthizer's brief remarks Monday offered the most detailed
rundown to date on how the Trump administration views the global
trade overseer. He alluded in particular to the breakdown in the
WTO's ability to negotiate new rules -- the last major round took
effect in 1995 -- and its members' growing focus on the WTO's
courts.
"The WTO is losing its essential focus on negotiation, and is
becoming a litigation-centered organization," he said. "Too often
members seem to believe they can gain concessions through lawsuits
they could never get at the negotiating table."
Mr. Lighthizer also said the U.S. wondered "whether the current
litigation structure makes sense," echoing Trump administration
complaints that WTO courts too often issue rulings it believes go
beyond the written rules -- and against Washington. To back up that
position, the Trump administration is blocking the WTO's ability to
fill vacancies on its main trade court, aggravating a case
backlog.
Mr. Lighthizer was one of the few delegates speaking at Monday's
session who didn't endorse the official agenda for negotiations
this week -- new rules in areas like curbing fishing subsidies or
covering digital commerce. "It's impossible to negotiate new rules
when many of the current ones are not being followed," he said.
The U.S. sets a higher priority on creating new rules requiring
countries to do a better job of reporting trade policies and
subsidies, he said, an area where Americans say the Chinese have
repeatedly fallen short.
Trade ministers from other member countries who spoke Monday
didn't criticize Messrs. Trump or Lighthizer directly, but many
voiced veiled criticism of the new U.S. "America First" trade
policy, which questions the value of the WTO and multilateral
trading system it governs.
"There is a need to preserve and to reinforce the WTO," the
Swiss delegate said, noting the current "challenging environment"
for trade. Hong Kong's trade minister said he was "troubled to see
that the multilateral trading system is being cast in doubt and
under attack."
"Trade protectionism is on the rise," said Zhong Shan, China's
commerce minister. "The multilateral trading system is a critical
safeguard for prosperity and development."
"You must stand up for multilateralism," said Arancha González,
a Spaniard who runs a joint United Nations-WTO trade-promotion
agency, closing the round of speeches. "You must make trade great
again," she said, alluding to Mr. Trump's signature campaign
slogan.
Earlier in the day, more than 40 trade ministers from developed
and developing countries issued a statement expressing strong
support for the WTO and concern about the challenges it faces. They
demanded an end to the U.S.-led impasse over judicial appointments
on the trade courts. Neither the U.S. nor China signed the
document.
Mr. Lighthizer received some support for his call to steer the
WTO to take on China more directly. Japan's trade minister,
Hiroshige Seko, endorsed the U.S. demand to boost transparency,
strengthen rules addressing state-owned enterprises and better
regulate market-distorting measures. Those changes, Mr. Seko said,
were needed to "further enhance the credibility of the multilateral
trading system."
--Taos Turner contributed to this article.
(END) Dow Jones Newswires
December 11, 2017 12:54 ET (17:54 GMT)
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