WASHINGTON – United States Trade Representative Katherine Tai today delivered remarks at the Center for Strategic and International Studies on the World Trade Organization (WTO) and the multilateral trading system.
In her remarks, Ambassador Tai affirmed the Biden-Harris Administration’s commitment to a reformed WTO and underscored that the institution must adapt to address today’s pressing challenges, including climate change and non-market economic policies. Ambassador Tai also emphasized that the WTO’s rules were never meant to be static and that being committed to the organization means being committed to a substantive reform agenda.
As a sign of the United States' commitment to the WTO, President Biden called for its reform during his speech at the 78th Session of the United Nations General Assembly in New York earlier this week. In an April 2023 speech at the Brookings Institution, National Security Advisor Jake Sullivan emphasized the United States' commitment to "the WTO and the shared values upon which it is based: fair competition, openness, transparency, and the rule of law," while acknowledging the organization must be reformed to address the serious global challenges that undermine those principles.
Ambassador Tai’s remarks as prepared for delivery are below:
Hello, everyone. It’s great to be here with all of you, especially with my good friend Dr. Ngozi. I also want to thank CSIS for hosting us and Dan for moderating our upcoming conversation.
Since I was sworn in as the U.S. Trade Representative, Dr. Ngozi and I have had many productive conversations—on how we can work together to revitalize the WTO, to make it more relevant to today’s challenges. We have already done good work together at the 12th Ministerial Conference in June 2022, and I look forward to doing more.
This is because the United States is committed to the organization and its foundational goals and values, as our National Security Advisor Jake Sullivan made clear in his speech at the Brookings Institute in April.
For decades, the United States has been proud to champion the international rules-based order and the multilateral trading system.
With partners, we negotiated a system reflecting our common vision of openness, transparency, and fair, market-oriented competition.
But the functioning and fairness of this order are now in question.
That is why, as all of us adapt to a more challenging era—marked by rapid technological change, increasing extreme climate events, vulnerable supply chains, intensifying geopolitical friction, widening inequality, and spiking food insecurity—we all need a WTO focused on its foundational goals.
This is precisely why the United States is writing a new story on trade.
We’re pursuing fair competition, addressing the climate crisis, promoting our national security, and ensuring the rules-based system helps all economies, not just the biggest ones. Our aim is to grow our economy from the middle out and the bottom up, and our trade policies are an integral part of that goal.
The WTO and the multilateral trading system’s rules were never meant to be immutable or static. The creators of the WTO envisioned an organization that would change and adapt through negotiations among its Members.
Take climate change, which was not our focus when we created the WTO.
Today, Dr. Ngozi and—I think all of us—agree that the WTO needs to be part of the climate solution. The WTO has multiple climate workstreams. But we need to focus on how the WTO can support and facilitate Members taking meaningful actions on climate.
Another example is the interests of workers. At a time when working people in many of our societies are reporting an increasing sense of economic insecurity, we should remember that workers are the backbone of our resilience. Their success is our success. But the current WTO does not reflect that.
This is why we are working with WTO Members and Dr. Ngozi on a comprehensive reform agenda.
The good news is that many Members—developed and developing countries—share in this vision. After all, the WTO’s founding document recognizes that trade should raise living standards, ensure full employment, pursue sustainable development, and protect the environment.
We are ready to adapt and are rolling up our sleeves. In fact, you can see this resolve in action as the United States and dozens of Members have ratified the new Agreement on Fisheries Subsidies—and many, many more are working to complete ratification.
Right now, being committed to the WTO also means being committed to a real reform agenda. So, let me highlight a few of our priorities for a WTO fit for today’s economic realities.
First, improving transparency.
The United States was the first Member to table a proposal on transparency five years ago.
Transparency is a precondition to ensuring fairness and accountability in the system. Every WTO Member has the responsibility to let other Members—and the public—know of their laws and regulations affecting trade.
This is critical for fair competition and a level playing field for working people everywhere. Strengthening transparency will improve our ability to monitor compliance and to resolve our disputes.
To get there, we need to make it easier for Members to share their laws and regulations and for the public to search and view them. That’s why we are working on using new digital tools to do just that. And we support providing technical assistance for developing countries so that we all benefit from this.
We also need to make this a meaningful norm of WTO membership. Members took on an unqualified obligation to be transparent and make notifications, and these commitments have to mean something. Countries that are deliberately not honoring this obligation are undermining the international trading system.
Our next priority is continuing to rebuild the WTO’s ability to negotiate new rules for the new challenges that we face.
This won’t be easy or comfortable. But it is necessary to create the rules and mechanisms we need for the times through diplomacy and negotiation between Members, not through litigation between their hired guns.
Let me explain what I mean. For example, consider the massive global economic disruptions from non-market policies and practices that are contrary to the basic rules and norms that we all agreed to.
Things like industrial targeting or discriminatory interventionist activities of state-owned enterprises. This is how certain Members are continuing to skew the playing field, strategically and systematically.
They seek to dominate key industrial sectors, promote national champions and discriminate against foreign competitors, massively subsidize key sectors, and manipulate cost structures.
And as they become dominant suppliers for many important goods and technologies, they create supply chain concentrations and vulnerabilities—which in turn become levers for economic coercion.
These practices are unfair and disadvantage workers in developing and developed countries alike, the very people the system should empower and lift up. So, we need to have real conversations about how the WTO can address these issues.
Finally, I want to highlight dispute settlement reform.
The goal here is not restoring the Appellate Body or going back to the way things used to be. It is about providing confidence that the system is fair. And revitalizing the agency of Members to settle their disputes.
The system was meant to facilitate mutually agreed solutions between Members. But over time, it has become synonymous with litigation—costly and drawn out, and often only accessible to Members who have the resources to foot the bill.
The system has also suffered from a lack of restraint. The Appellate Body systematically overreached to usurp the role of Members themselves to negotiate and create new rules. And in so doing, it undermined the ability of all Members to defend their workers from harmful non-market policies.
For the last year, we’ve been actively participating in innovative and constructive discussions with WTO Members of all sizes—including developing country Members—to hear their concerns and solutions for a better system.
We are thinking creatively and have come forward with concrete ideas that could promote fairness for all Members. For example:
- We should make practical and appropriate alternatives to litigation—like good offices, conciliation, and mediation—real options for the entire WTO membership.
- We should ensure that dispute panels address only what is necessary to resolve the disputes and resist the urge to pontificate. And any corrections to reports or decisions must be limited to addressing egregious mistakes.
- We should end judicial overreaching and restore policy space so that Members can regulate and find solutions to their pressing needs, such as tackling the climate crisis or defending their workers’ interests from non-market policies.
And we urgently need to correct WTO panel reports that have asserted that the WTO may second-guess Members’ legitimate national security judgements, something none of us ever intended. This calls into question foundational principles of how far-reaching trade rules should be.
Everywhere I go, and everyone I meet, I’m taking the opportunity to engage on these issues.
That’s because making this a collaborative process is good for all of us and for the WTO, and we’re glad to be working with our colleagues to bring new ideas to the table.
To achieve any level of success, we need a Member-driven approach to reform.
Where economies of all sizes and different levels of development come to the table. Where we all have a stake in outcomes that will help deliver for our people today and tomorrow. Where we build our middle classes together, rather than pitting them against each other.
Accordingly, we must recognize the diversity of developing Member.
We should have flexibilities in the rules that reflect actual needs, but we cannot have economic and manufacturing powerhouses gaming the system by claiming the same development status and flexibilities intended for less advantaged Members.
Some partners say that we should show progress on our reform work by the 13th Ministerial Conference in February—and we wholeheartedly agree.
In fact, we think it’s very important to lock in progress on areas where we can agree, rather than continue to preserve an unsatisfying status quo until some theoretical point in the future when we all agree on everything.
As we work to advance these reforms, it’s important to acknowledge and support the good work that happens every day on the ground.
Our “reform by doing” approach is notching real progress. We are collecting and sharing ideas at the committee level. Making meeting agendas more relevant and responsive. Effectively using digital tools. And clustering meetings so that more experts from capitals can participate.
We are making progress.
Recall that prior to MC12, WTO Members spent nearly nine years paralyzed and unable to conclude negotiations on any significant new agreements. And since MC12, Members have rallied around the call for reform, and multilateral trade discussions are seeing a new dynamism in Geneva and around the world.
MC13 will be the first WTO “reform ministerial,” and it is an opportunity for us to come together and deliver.
It will be an important milestone, but not an endpoint. In fact, we should look forward to setting ourselves up for success at the next milestone, which will take place at MC14 in Cameroon.
As the global economy continues to evolve, we will need to keep working—to achieve greater fairness in the system, and to deliver for workers and communities around the world. To emerge stronger and more resilient through these uncharted times.
Trade cannot solve all of our problems, but institutions like the WTO can and should be a part of the solution and help more people share in more of the benefits of increasing economic growth.
The United States wants a WTO where dispute settlement is fair and effective and supports a healthy balance of sovereignty, democracy, and economic integration. Where all Members embrace transparency. Where we have better rules and tools to tackle non-market policies and practices and to confront the climate crisis and other pressing issues.
As President Biden emphasized at the United Nations this week, and I quote: “We’re going to continue our efforts to reform the World Trade Organization and preserve competition, openness, transparency, and the rule of law while, at the same time, equipping it to better tackle modern-day imperatives, like driving the clean-energy transition, protecting workers, promoting inclusive and sustainable growth.”
The United States will continue to play an active role in this effort, and we look forward to working with all Members in the coming weeks and months.
Thank you, and now I have the pleasure of turning the podium over to my good friend, Dr. Ngozi.