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Did the protectionist dog bark? Transparency, accountability, and the WTO during the global crisisRobert Wolfe

WTO Public Forum

September 16, 2010

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Accountability in this project

Ask: who is accountable to whom; about what; through what processes; in accordance with what criteria; and with what effects?

Not simply “abuse of power” Closing the gap between what is committed

or promised, and what is actually accomplished

How do we observe accountability, and what can it explain?

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Why a dog?

Gregory: "Is there any other point to which you would wish to draw my attention?"

Holmes: "To the curious incident of the dog in the night-time."

Gregory: "The dog did nothing in the night-time."

Holmes: "That was the curious incident."- Arthur Conan Doyle, Silver Blaze (1892)

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WTO Members accountable for what?

1. WTO regime obligations?

2. G20 London summit commitments? How would you assess?

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Three questions

1. Were G20 Members accountable? refraining from new barriers, export restrictions, or WTO-

inconsistent measures; minimizing negative impact on trade and investment of

stimulus measures; notifying promptly International organizations to monitor and report

2. Did civil society contribute to accountability? drawing attention to data WTO missed, or providing robust alternative interpretations of data

3. Has the response to the crisis been “protectionist”? What is the evidence? How should it be interpreted?

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Notifying promptly

Lots of notification, but some G20 Members seem to have been recalcitrant

Good cooperation in “verification” of third-party data

TPRB has been monitoring the results Secretariat publishes the reports

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Refrain from new barriers, export restrictions, or WTO-inconsistent measures tariff increases, but not above binding services changes in direction of openness new AD investigations declined from 193 in 2008 to

152 in 2009 new CVD and safeguard investigations increased

historic high of 30 CVD in 2009 from average of 14 a year to 28 for safeguards

Using legal flexibilities in Agreements not “protectionism”

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Minimize negative impact?

October 2008 to

October 2009 September 2009 to

February 2010

Share in total world imports

0.8 0.4

Share in total G20 imports

1.3 0.7

Share of trade covered by G20 import-restricting measures, %

If Members complete the Doha Round, benefits would reverse and overwhelm these small effects

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The story so far

Answers for for first set of questions seems positive on basis of reports prepared by international organizations dominated by G20

They would say that…

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Broken Promises?

Global Trade Alert (GTA) said “The protectionist juggernaut continues” “The serial violation of the G20 pledge” “The harm done by discriminatory state measures

is widespread” Press release:“sky is falling” vs “mostly

sunny, with scattered clouds”

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Did civil society contribute more data?

Trade and trade defence

Total All

countries

G20 Members

WTO Annex 1 measures 631 15 GTA equivalent measures 582 17

Bail out / state aid WTO Annex 2/3 measures 402 19 GTA equivalent measures 204 14

Initiation of AD investigation, one tariff change, and huge subsidy = “measure”

WTO found more measures, for most G20 Members

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State aid/bailout comparison

GTA database has measures from 44 countries, plus the EC.

WTO has measures from 71 countries, plus the EC.

All G20 countries appear in both six do not appear on the GTA list one does not appear on the WTO list

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Robust alternative interpretations? No clarity on how measures categorized or

discrimination assessed e.g. migration

Aggregation of unlike measures of varying significance in disparate sectors has no economic basis

Tariff lines or trading partners likely to be affected is no substitute for economic analysis of the amount of commerce affected

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The protectionist dog did not bark

1. What is the evidence?a. No long time series of “measures” but number does not

seem far off trendb. Social and economic factors that create pressures to

favour “us” at the expense of “them” always presentc. Impact seems slight

2. How should accountability be interpreted?a. Institutions seem to be moderating the effects, as intendedb. Transparency may be helping to reinforce regime norms,

closing the gap

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What do we learn from the curious incident? Ad hoc notification can work Notification has been uneven

WTO should tell us more about the recalcitrants But verification of third party data may be better than first

party notification in some cases (e.g. subsidies) GTA online database is great

WTO should emulate Civil society organizations should supplement

official sources GTA should probe for gaps; offer alternative interpretations

More analysis needed of things that don’t look like traditional trade measures