Failure to agree on a viable reform path for the World Trade Organization (WTO) at next week’s meeting could push members to explore alternative mechanisms for setting trade rules, diplomats and officials told Reuters.
The four-day gathering of trade ministers in Yaounde, Cameroon, comes at a critical juncture for the WTO, the 1995 successor to the General Agreement on Tariffs and Trade (GATT).
The talks are also unfolding against the backdrop of the U.S.-Israeli war on Iran, which has disrupted global energy supplies and threatens to undermine economic stability worldwide.
Additionally, rising trade tensions and the paralysis of the WTO’s dispute settlement mechanism have challenged the body’s relevance in an era of growing unilateral measures.
What they are saying
Most WTO members support reform but are divided on how to agree on a clear roadmap, according to diplomats and internal documents seen by Reuters.
European and other trade officials suggest alternative paths may be necessary if multilateral agreement stalls.
- “Our ‘Plan A’ is to get reform within the WTO system, but there are many hurdles,” Swedish Trade Minister Benjamin Dousa said.
- Dousa added that failure of the Yaounde talks would encourage the European Union “to pursue a parallel track,” deepening cooperation with members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and other like-minded economies.
- As a “Plan B,” he said the EU may explore plurilateral agreements—deals where willing members make binding commitments outside the broader WTO framework.
- EU diplomats noted such agreements could “supplement” the WTO, allowing targeted rule-making while keeping reform on the multilateral agenda.
Despite divisions WTO Director-General, Dr. Ngozi Okonjo-Iweala expressed cautious optimism: “I expect it to be quite a difficult ministerial,” she said.
Get up to speed
The WTO was established in 1995 to oversee international trade and replace GATT, aiming to promote free trade through multilateral agreements.
In recent years, the organization has faced mounting challenges, including stalled dispute resolution, unilateral tariffs such as those imposed by the U.S., and a rise in plurilateral or bilateral agreements.
Tensions over digital trade, investment facilitation, and the Most Favoured Nation (MFN) principle have further tested the system, prompting calls for modernization to reflect 21st-century trade realities.
More insights
Internal restricted WTO documents reveal deep divisions among members on the path forward.
- The U.S. supports reform but resists a detailed workplan, while the EU, Britain, and China favor a substantive roadmap.
- Washington seeks a permanent extension of the moratorium on customs duties for electronic transmissions, which expires this month. Failure could undermine U.S. engagement in the WTO.
- India is expected to oppose the moratorium, while the International Chamber of Commerce warns that failure could trigger new taxes on cross-border data flows.
- Ministers will also discuss potential updates to the MFN principle, which governs 72% of global trade, with the EU and U.S. signaling interest in reassessing its relevance, particularly regarding China.
What you should know
Nairametrics reported that Okonjo-Iweala had said that Africa will be minimally affected by the tariffs imposed by the United States of America under President Donald Trump’s trade policy direction.
In 2021, Okonjo-Iweala was appointed as the Director-General of the World Trade Organisation.
Okonjo-Iweala became the first woman to ever lead the Switzerland-based institution and the first African citizen to take on the role.
