By Liz Hay
Elm Staff Writer
On Feb. 15, the World Trade Organization announced the selection of Ngozi Okonjo-Iweala as the organization’s seventh director-general. Dr. Okonjo-Iweala’s term as the first woman and first African director-general will last from Mar. 1, 2021 to Aug. 31, 2025.
The WTO is an international organization that regulates trade among member nations. According to data on their website, the 151 member states of the WTO represent over 90% of the world’s population and almost 96% of global trade. Accession to the organization requires a nation to have full autonomy over its trade and enter into rounds of negotiation with WTO.
Under the Trump administration, the United States was the only nation to hold up Dr. Okonjo-Iweala’s appointment, citing concerns over lack of experience. The Biden administration reversed this position in a statement released by the Office of the U.S. Trade Representative on Feb. 5.
“[She] brings a wealth of knowledge in economics and international diplomacy from her 25 years with the World Bank and two terms as Nigerian Finance Minister,” the statement said.
Dr. Okonjo-Iweala is stepping into leadership at a time when COVID-19 has wreaked havoc on global trade and economic wellbeing. The pandemic’s impact on trade in 2020 was profound. Lockdowns impacted domestic supply chains and global trade mechanisms, as the process of goods crossing international borders introduces significant risk of COVID-19 transmission.
The pandemic affected regions around the world differently. For example, low-income countries disproportionately bore the burden of the 27% drop in global trade of services, according to the WTO. Although projections expect global trade to rebound in coming months with vaccine rollout and easing of lockdowns, there is a lot of work to be done to facilitate trade safely as the pandemic continues.
This work will also largely depend on the accessibility of the COVID-19 vaccine. It is an unfortunate reality that the lifesaving vaccine has the potential to be hugely profitable for companies and nations that control the supply. The world will not be safe from another COVID-19 wave until vaccines are widely accessible to all people, regardless of their nation’s economic leverage.
Global distribution of the COVID-19 vaccine is the biggest current issue of worldwide equity, and Dr. Okonjo-Iweala’s WTO must take an active role in tempering profit-motivated world trade in favor of prioritizing human rights.
In addition to the pandemic, trade has become an important economic battleground for the growing tension between China and the U.S. to play out. The Trump administration imposed tariffs and other trade barriers on Chinese goods, to which the Chinese government responded in kind.
Experts expect that President Joe Biden will continue with similar tactics as his predecessor and “looks set to renew pressure over trade and technology grievances,” AP News said a few days after Biden’s inauguration. The WTO has struggled to address this rising conflict in past years and must take a strong role in easing tensions between the two nations.
The people hurt in trade wars are not just the citizens of direct combatants, who face rising consumer prices and decreased access to foreign markets.
According to a projection from the World Bank, the China-U.S. trade war has the potential to increase short-term gains for developing nations, but in the medium term could result in a $1.4 trillion loss of global income, with about half of that loss felt by people in developing countries.
Dr. Okonjo-Iweala is poised to implement the global perspective necessary to prevent this damage and facilitate negotiations between the two economic giants before these possibilities are realized.
As a WTO leader with demonstrated experience in reforming economic institutions from her time as Nigerian finance minister, Dr. Okonjo-Iweala has the opportunity to steer the WTO in a direction that prioritizes the needs of traditionally disadvantaged regions and groups in world trade.
“Economic development” too often means “economic colonialism,” but ethical world trade can be a powerful tool to improve the conditions of the poorest people. Dr. Okonjo-Iweala must leverage her term as director-general to radically reimagine the role of the WTO as an organization that closes — rather than widens — global economic disparities.
In a statement after her appointment, Dr. Okonjo-Iweala seemed optimistic that these goals can be met by working together.
“There is light at the end of the tunnel if we work together in a transparent manner that builds trust, builds bridges, defuses political tensions, and encourages convergence.”
Featured Photo caption: Dr. Ngozi Okonjo-Iweala was named director-general of the World Trade Organization on Feb. 15, 2021, making her the first woman and African leader of the organization. Photo Courtesy of Wikimedia Commons.