Comments on: Trading Our Way Out of the Financial Crisis: The Need for WTO Reform http://www.globaleconomicgovernance.org/blog/2009/03/trading-our-way-out-of-the-financial-crisis-the-need-for-wto-reform/ from the Global Economic Governance Programme at the University of Oxford Mon, 06 Dec 2010 15:39:53 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Dr. R. Shashi Kumar http://www.globaleconomicgovernance.org/blog/2009/03/trading-our-way-out-of-the-financial-crisis-the-need-for-wto-reform/comment-page-1/#comment-6529 Dr. R. Shashi Kumar Wed, 25 Nov 2009 17:58:46 +0000 http://www.globaleconomicgovernance.org/blog/?p=306#comment-6529 As an institution, the WTO has functioned very differently from theGATT. The old power centers within the multilateral trade regime have been joined by new powercenters, especially the emerging economies. Developing and the least-developed members, actingin coalitions, have become more effective players in the Doha Round with significant success inensuring that WTO agreements are in their favour. However, they have not had similar success insetting the negotiating agendas that meet their expectations and development concerns. Two related developments appear to be at the root of the recent chaos in the global governance system, with direct implications for the trade governance regime. First, in terms of hegemonic cycles, the United States (US) was a rising contender for hegemony as of 1873, achieved full hegemonic dominance in 1945,and the fruits were reflected in the leadership position it assumed to create the world trading governance regime in 1947 in the form of GATT and in ensuring that the progressive trade integration and tariff liberalisation continued despite the economic turbulence of the 1960s and 1970s. Second, the US dominance on global economy has been slowly declining since the 1970s, and in this new century we are past any semblance of US hegemony.2 We seem to have entered a multipolar world where the emerging developing countries are beginning to play increasingly definitive roles because of their economic strength, but the global leadership issues still remain unaddressed. A solution to the above conundrum will not be easily obtained or obtained in the near future. But in resolving it, to begin with, the world and the multilateral trading system needs to realign itself with changing realities of our times where developing countries are emerging as important players in the negotiations and governance systems of both international trade and finance. As an institution, the WTO has functioned very differently from theGATT. The old power centers within the multilateral trade regime have been joined by new powercenters, especially the emerging economies. Developing and the least-developed members, actingin coalitions, have become more effective players in the Doha Round with significant success inensuring that WTO agreements are in their favour. However, they have not had similar success insetting the negotiating agendas that meet their expectations and development concerns.

Two related developments appear to be at the root of the recent chaos in the global governance system, with direct implications for the trade governance
regime. First, in terms of hegemonic cycles, the United States (US) was a rising contender for hegemony as of 1873, achieved full hegemonic dominance in 1945,and the fruits were reflected in the leadership position it assumed to create the
world trading governance regime in 1947 in the form of GATT and in ensuring that the progressive trade integration and tariff liberalisation continued despite the economic turbulence of the 1960s and 1970s. Second, the US dominance on global economy has been slowly declining since the 1970s, and in this new
century we are past any semblance of US hegemony.2 We seem to have entered a multipolar world where the emerging developing countries are beginning to play
increasingly definitive roles because of their economic strength, but the global leadership issues still remain unaddressed.

A solution to the above conundrum will not be easily obtained or obtained in the near future. But in resolving it, to begin with, the world and the multilateral trading system needs to realign itself with changing realities of our times where developing countries are emerging as important players in the negotiations and governance systems of both international trade and finance.

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