DDG Nordquist: Fit-for-purpose WTO can help unlock trade's full potential

Ladies and gentlemen, esteemed colleagues, and distinguished guests,

Good morning, and thank you for the warm welcome. It is a privilege to address you today in Mumbai, the economic heart of India, whose vibrancy and entrepreneurial spirit are a testament to the talent and drive of your people.  This is also my first trip ever to India - visiting has always been on my bucket list, so I really appreciate the invitation!

As many of you are aware, India is currently the fastest-growing G20 economy, set to become the world's fourth largest. You can feel that growth in the air - it's tangible.  Since 1960, your GDP per capita has risen more than 600-fold, and your human capital index has nearly doubled.

Of course, trade has always been at the heart of any country's economy.  India's own trade history is rich - from Indus Valley exchanges with Mesopotamia to your central role on the Silk Road and the Spice Routes. Thousands of years later, you continue to be a dynamic force in global commerce.

Your recent progress is especially notable in the digital economy, where exports of digitally delivered services have grown at double-digit rates, underscoring India's expanding role in global technology and innovation, which leads to job growth and higher income.

Looking ahead, India is embarking on an ambitious journey with your Viksit Bharat 2047 vision. The World Trade Organization, where India has been actively involved since 1948 with its predecessor GATT, plays a crucial role on this journey. Stable market access, global partnerships, and a rules-based international trade framework - all key pillars of the WTO - are essential to unlocking India's full potential and enabling it to achieve the 2047 vision.

Allow me to outline this in three key points.

First, reports that WTO has gone gently into that good night, to paraphrase the famous poet Dylan Thomas, are wrong. The WTO still remains the cornerstone of the global trading system, complemented by bilateral and regional trade agreements. According to WTO economists, the vast majority of global goods trade - 72 percent - continues to flow under the WTO's most-favored-nation tariff rates. 

Let's look at the G20, which represents 85 per cent of global GDP and 75 per cent of world trade.  While our recent report on G20 economies shows that the number of trade-restrictive and other measures, like subsidies, is at its highest in the history of trade monitoring, that's counterbalanced by a similarly large number of new trade-facilitating measures. 

That's right, many trade barriers are actually coming down globally, in spite of all the headlines about tariffs and trade wars. Importantly, G20 economies have largely refrained from retaliatory actions, preferring dialogue and efforts to reduce trade frictions instead. So even amid the need for rebalancing and other geopolitical pressures, there has been a continued commitment to enhancing global trade cooperation.

Second, WTO Members continue to negotiate new rules, including the landmark Agreement on Fisheries Subsidies, which entered into force this September. I understand that India is in the process of finalizing its ratification, and I hope that we will soon receive your instrument, and that WTO Members make progress in completing the second wave of negotiations. Moreover, large groups of Members are actively pursuing plurilateral negotiations on various issues, reflecting the evolving nature of global trade and the diversity of Members' interests. While some countries, including India, have expressed concerns, it is essential that we find solutions that work for all, and prioritize the long-term health and effectiveness of the multilateral trading system, ensuring that it remains capable of addressing emerging global challenges. 

Third, trade disputes continue to be resolved via the WTO dispute settlement system, in spite of the non-operational Appellate Body. In fact, since 2019, more disputes have been resolved, settled, or suspended than have been appealed into the non-functioning part of the system. A notable example: The settlement of all 7 outstanding trade disputes between India and the United States on a range of items such as steel, solar, and agriculture. Members also use the WTO's many committees and councils to resolve trade concerns. According to our latest data, about 43 percent of the 228 trade concerns raised in the Committee on Trade in Goods over the last 3 decades have been resolved. And this figure does not yet reflect all Members' reporting, so the true share is likely even higher.

That's not to say that the WTO is without its challenges, just like many other multilateral organizations that need to adapt to a world very different from the one in which they were created decades ago. 

Reform is needed, and all WTO Members recognize this. Decision-making, development, and ensuring fair competition and balanced trade are key areas where WTO Members are considering improvements. The upcoming Ministerial Conference in Cameroon in March offers an important opportunity to advance this work, and we count on India's leadership and constructive engagement there.

To conclude, trade creates prosperity, and a strong and reformed WTO is essential for India to realize its economic vision, just as India's leadership is essential to strengthening the multilateral trading system. So let's work together for a revitalized WTO that is fit-for-purpose and capable of delivering real economic benefits for all its Members.