WTO: US to Consult; DG to Brussels; Agriculture

The United States has advised the World Trade Organization that it is ready to enter into consultations with China and Canada over their challenges to tariffs imposed by the Trump Administration.  In separate communications to the WTO’s Dispute Settlement Body, the United States said it is prepared to discuss its measures, but made clear it stands behind them.

Although China and Canada both say the tariffs violate WTO rules, the United States countered that WTO members are allowed to take any steps necessary to protect their national security. “Issues of national security are political matters not susceptible to review or capable of resolution by WTO dispute settlement,” the United States said in both communications.

“Every Member of the WTO retains the authority to determine for itself those measures that it considers necessary to the protection of its essential security interests, as is reflected in the text of Article XXI of the GATT 1994.”

The United States noted that China and Canada have unilaterally decided that the US tariffs violate WTO rules and on that basis have retaliated with tariffs of their own. “It is specious” for both countries to turn to the WTO dispute settlement system over an alleged breach of WTO rules when they are violating WTO rules, the United States said.

DG to Brussels

World Trade Organization Director-General Ngozi Okonjo-Iweala is expected to visit Brussels to hold consultations on a range of issues, in the face of growing uncertainty arising from unilateral tariffs imposed by the Trump Administration on Canada, Mexico, China, the European Union and other countries, said people familiar with the developments.

Some of the affected countries already announced retaliatory tariffs against the American goods, while the EU’s retaliatory measures against the US goods will come into effect on April 1.

More crucially, Washington is expected to announce reciprocal tariffs on all countries on April 2, a move that is seen as a frontal assault on the multilateral trading system, particularly the WTO, said people familiar with the development. So far, there is no explicit statement from the WTO's leadership on these epochal developments, said people familiar with the developments.

The DG’s visit seems to coincide with the celebration of 50 years partnership between the EU and China for which leaders from both countries are expected to participate, said people familiar with the developments.

Agriculture Chair

Pakistan’s trade envoy to the World Trade Organization, Ambassador Ali Sarfraz Hussain, is being nominated as the chair of the Doha agriculture negotiating body, commonly referred to as the Committee on Agriculture in Special Session. General Counsel Chair Saqer Abdullah Almoqbel of Saudi Arabia, urged members last week to consider the nomination. There had been widespread support for the candidature of Guyana’s trade envoy to the WTO, Ambassador Leslie Satruken Ramsammy, including from the powerful the Group of Latin American and Caribbean countries, said people familiar with the developments.

However, working behind the scenes over the past few weeks, Pakistan’s trade envoy managed to garner support for his candidature and also managed to be sponsored by the Asian group, said a trade envoy who asked not to be quoted.

It is against this backdrop, the GC chair sent an email to members, seen by WTD, informing members that “the Asian Group has put forward” Ambassador Sarfraz Hussain as candidate “for chairperson of the Committee on Agriculture in Special Session.”

“I have asked group co-ordinators to consult their constituencies about this nomination, and I have reached out to Members that are not part of the regional groups.” The GC chair wrote that he is “please to inform you (members) that I have not received any reservations to this nomination,” urging the “membership” to consider this nomination positively.” The GC chair said that if he does not “hear back from any Member by close-of-business on Thursday, 20 March, I take it that the nomination is acceptable to all, and I would issue as separate communication inviting the Committee on Agriculture in Special Session to formally Ambassador Hussain as its Chairperson at the next CoA-SS meeting.”

It remains to be seen whether the United States is okay with the nomination of Ambassador Hussain as the chair of the CoA-SS, given his track record of aligning with India and Sri Lanka on the permanent solution for public stockholding programs on which Washington has remained daggers crosses since 2015, said people familiar with the developments.