WTO helping resolve trade disputes in world markets even without a new world trade agreement


The agricultural-producing countries of the world continue to battle for key markets. But some of the sting is being taken out of those disputes, and they often don’t last as long as they once did thanks to the WTO. Dr. Daniel Sumner talked about those changes and the outlook for world trade dispute resolution in a presentation at the American Society of Farm Managers and Rural Appraisers annual meeting in Reno, Nev.

A number of free trade agreements have sprung up outside the framework of the World Trade Organization in recent years. The U.S. and South Korea, the U.S. and Columbia, Canada and the European Union all are examples of these, Sumner notes. The U.S. government has been focusing more recently on the Trans-Pacific Partnership or TPP as part of its efforts to open up markets in the Asian countries.

“It’s of small, positive impact,” he said. “The reason I say small is because we already have free trade agreements or pretty open trade with lots of Asian countries. So it’s not going to be a big deal for us, but there will be some positive openings; there will be some reductions in tariffs; there will be some harmonization; and there will be some discussion clubs.”

When it comes to trade disputes, discussion clubs are important because countries don’t have to wait six months to decide when and where they’re going to talk. “It’s automatic and when you have a dispute that’s important.”

Sumner said he can’t predict whether WTO members will reach a deal on a new world trade agreement in the next year or two. He’s not sure it will make that much difference whether the world’s longest-running trade negotiations are completed.

“The WTO is now a mature organization that settles disputes,” he says. “So we can move things along. The very fact the WTO sits there as a court means there’s a lot of things countries don’t do. Japan, Korea and China, even, hold back on blocking trade for excuse reasons, not for legitimate reasons, because they know there will be a WTO case, and they know they’re likely to lose it.

“By the standards of the U.S. courts, the WTO moves remarkably fast; you’ll get a decision in a year or two, maybe three. Most courts don’t operate that quickly. Those of you who have been involved in complicated lawsuits know that’s true.”



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