How WTO will handle Okonjo-Iweala’s US rejection

By Samuel Adegoke

Now that the United States (US) has vetoed the selection of Nigeria’s candidate Ngozi Okonjo-Iweala for the position of Director General of the World Trade Organisation (WTO), some options are available for the organisation to resolve the impasse.

The US vetoed Okonjo-Iweala’s candidacy in spite of the fact that most of the 164-member nations across regions supported her.

According to Politico, Washington is throwing its weight behind her opponent, the South Korean candidate, Yoo Myung-hee, saying that she has “25 years of trade experience and that she would be able to hit the ground running,” according to a WTO spokesperson.

Okonjo-Iweala is a former World Bank No. 2 and twice acted as Nigeria’s finance minister. She was presented as the consensus candidate to WTO members after a long process of consultations with all members in Geneva.

The decision of the US also came late according to analysts who believe the veto could delve further blow to the global trade organisation which is already struggling in some ways.

WTO uses consensus-based approach for selecting a chief.

To resolve the current impasse, WTO officials will now hold consultations with member nations to gain a consensus at the meeting of all delegations slated for November 9.

“By setting that date, the WTO is already blowing through the deadline it had originally set for the selection process.” Politico noted.
If a consensus cannot be reached on November 9, the organisation could opt for voting, which would overrule US’ veto.

At the meeting on Wednesday, no delegation suggested that. In WTO terms, this is a nuclear option which explodes its preference for negotiated settlement.

An outvoted United States would also hardly be more likely to have a change of heart and unfreeze the impasse at the Appellate Body.

“The overwhelming preference of our members is to decide by consensus. Consultations will be held between now and the 9th of November to try and achieve that consensus,” the WTO spokesperson said.

The WTO spokesperson told Politico that Okonjo-Iweala had the most preferences across regions by a wide margin, across both developed and developing countries. Many members, including the EU, had previously suggested that it was time for both the first African and the first woman to lead the organisation.

“Regrettably, every decision before the WTO membership these days is not easy,” said Wendy Cutler, a former senior U.S. trade official who served in both Democratic and Republican administrations.

“There were two well-qualified, impressive women for consideration and the WTO could not have gone wrong with either one,” she added.

Overruling the U.S. by opting for a vote would also make it harder to get Washington on board for any reform plans Okonjo-Iweala might have. U.S. President Donald Trump is a fierce critic of the WTO and has previously threatened to pull the U.S. out. Former WTO Director-General Roberto Azevêdo even saw it as an accomplishment that the U.S. had not quit on his watch.

A possible way out of the impasse, according to the online news magazine, is a potential shift in the U.S. position if Democratic candidate Joe Biden wins the U.S. elections on November 3. But even if Biden wins, the new U.S. administration wouldn’t take office until January 20 next year.

Delaying the entire process until then might save the WTO in the longer term, but it’s unclear whether members will have the patience to wait for the the tectonic plates to shift in U.S. politics.

“That’s not good for the organisation, but I’m not sure there’s an easier alternative.

“Some people will want to vote, if only to spite the U.S., but most will want to preserve the consensus model as it protects them in the future. There could be a search for a third candidate. I don’t think the U.S. can force the other 163 to give way,” Reinsch said.