Thirteenth Ministerial Conference of the WTO : Remarks by Director-General

 The MC13 opening ceremony

Remarks by Director-General Okonjo-Iweala

Thirteenth Ministerial Conference

Chair H.E. Dr Thani bin Ahmed Al Zeyoudi,
Minister of State for Foreign Trade of the United Arab Emirates
MC13 Vice-Chairs,
General Council Chair, H.E. Ambassador Athaliah Molokomme of Botswana
Excellencies, Ladies and Gentlemen.

Welcome to the Thirteenth Ministerial Conference of the WTO!

It is wonderful to be here in the UAE, and in the Gulf region, which for centuries has been a vital crossroads for goods, people, and ideas.

I want to start by thanking our hosts for their excellent cooperation throughout the months of preparation leading up to our gathering here in this spectacular venue. I am grateful for their optimism, their enthusiasm, and their willingness to act fast.

Minister Al Zeyoudi has already been hard at work for months to lay the groundwork for a successful MC13, chairing virtual meetings of ministers and reaching out in person to the full membership – most recently at a Special General Council in Geneva not even two weeks ago. I thank him and the UAE delegation in Geneva, led by Ambassador Jamal Al Musharakh and the Director of the UAE office to the WTO, Ambassador Abdelsalam Mohamed Al Ali, for their tireless efforts.

Let me also thank ministers from the Gulf region, who have been extremely supportive, and from the wider Arab Group, for taking on this ministerial as their own. All this support will hopefully help us deliver meaningful results here.

I'm delighted to say that we are kicking off this meeting with some excellent news. Here at MC13, the WTO is welcoming its first new members in almost eight years: Timor-Leste and Comoros. We celebrate the hard work they have put in, and the beneficial but challenging reforms they have implemented at home. Both countries are least developed countries, and we are excited to see them reap the gains of membership as they become new members of the WTO. Twenty-two more countries are seeking to follow in their footsteps – many of them are present here as observers, including a sizeable contingent from the Arab world. The opportunities they see in WTO membership, and their commitment to the demanding accession process, stand as an answer to anyone who questions the value that the WTO provides. Comoros and Timor-Leste will bring the WTO to 166 members, and we look forward to adding to that number in the years ahead.

Some additional good news is that the number of acceptances of the Fisheries Subsidies Agreement will reach 70 this week. Several ministers have brought their legal instruments with them to Abu Dhabi, and we will be celebrating them later today. MC13 has helped drive forward ratifications. With the 70 we will have this week, we now have 40 members to go, so the countdown towards entry into force can now start in earnest. Those members yet to ratify, I have a list of you. You know who you are. I hope you can work fast to help us allow entry into force by my birthday on 13th June of this year. Which will also mark 2 years since MC12. When we succeed it will be the fastest entry into force of any WTO agreement. And I know we will.

Excellencies, when we met in Geneva for MC12, almost two years ago now, my message to you was blunt. In keeping with my promise to bring a new pair of eyes and ears to the WTO, I told you what I was seeing and hearing from political and business leaders around the world. That the WTO needed to produce results, but expectations were very low that members could agree to.

But you defied those expectations and beat the odds. You showed leadership, you invested political capital, and bridged gaps. You worked together to make MC12 a resounding success. Members delivered what was dubbed the Miracle on Lake Geneva: ten consensus multilateral outcomes with tangible benefits for people and the planet and launched a comprehensive process of institutional reform. Members sent a powerful signal that the WTO can respond to contemporary challenges, and that in a world marked by strategic competition, we could also have strategic cooperation in pursuit of shared goals.

Success is changing the tone about the WTO – both outside and within it. Yes, we will always have our naysayers and detractors but there is no doubt that members have shown that we can deliver when members roll up their sleeves and muster the requisite political will. During the last several weeks, the atmosphere in our preparatory discussions in Geneva has been more constructive and conducive than it was in the run-up to MC12 - and I thank ambassadors, ministers and delegates for that. But as you can see from the documents sent to you, there is still a considerable amount of work to do. Ministers will have to roll up their sleeves, once more to complete the work left over from Geneva.

Whilst many of you empowered your ambassadors to make the necessary trade-offs during negotiations in Geneva, some of you did not, hence the important amount of work left for you to do. So our challenge this week is to prove that we can still deliver - and demonstrate that MC12 wasn't a one-off miracle on lake Geneva. We need to convert improved atmospherics into concrete results. We need to show the world that not only does the WTO underpin over three-quarters of global goods trade – it is also a forum where members deliver new benefits for people through trade.

Let's not pretend that any of this will be easy. If we thought the world looked tough in mid-2022, when we were slowly emerging from the pandemic, and the war in Ukraine had shaken food and energy security, we are in an even tougher place today.

Looking around, uncertainty and instability are everywhere. Geopolitical tensions have worsened. Conflict has spread, as we see here in the Middle East, and – away from the headlines – across parts of Africa and the Arab world. We must not forget the conflict in Sudan, which has displaced close to 8 million people internally and across borders, or the conflict in the east of the Democratic Republic of Congo. Higher prices for food, energy, fertilizer, and other essentials continue to weigh on people's purchasing power, fuelling political frustration.

Shipping disruptions in vital waterways like the Red Sea and the Panama Canal are a new source of delays and inflationary pressure, offering a real-time reminder of the risks posed to global trade and output by security problems and the climate crisis.

People everywhere are feeling anxious about the future – and this will be felt at the ballot box this year as 60-odd countries, home to nearly half of the world's population, go to the polls.

Economic growth has lost pace though it held up better than expected, particularly in some major economies like the United States and India, resulting in a softer landing for the global economy than earlier anticipated. However, there are places that are falling behind. The World Bank warns that the global economy is on track for its weakest five-year performance in 30 years. In many developing countries, debt distress and high financing costs remain a drag on economic prospects.

The pandemic ended a roughly 25-year-long trend during which, for the first time in centuries, poor countries began to narrow the income gap separating them from rich ones. Several countries in Africa are already well into a lost decade, and are in danger of falling even further back.

We can be proud of the fact that trade itself has been resilient in recent years. Despite everything we have been through, global goods and services trade remain at or near record highs. International markets anchored in the rules-based global trading system have stayed broadly open, helping businesses, households, and economies adapt and adjust to one shock after the other.

But it would be dangerously naïve to take trade's continued resilience for granted.

The global economic slowdown and wider uncertainty are already having an impact. Global merchandise trade volume growth in 2023 appears to have fallen short of the 0.8% we were projecting in October. And given all the downside risks, we may likely undershoot the 3.3% merchandise trade growth rate I just referred to for this year.

In addition, multilateralism is under attack. Despite the MC12 fightback, the Multilateral Trading System, which I term – a global public good since it was created 75 years ago – continues to be misconstrued in some quarters and undermined. Trade has become a four rather than a five-letter word in some quarters.

Yet trade remains critical to delivering on so many national and global priorities: boosting growth, expanding economic opportunities, meeting the Sustainable Development Goals, and solving collective action problems like protecting our environment or preparing for the next pandemic.

Without cooperation on trade, we would move towards an increasingly fragmented world economy, and all of these priorities would become harder, costlier, and in some cases impossible to achieve. People would become more disappointed, more vulnerable, more frustrated.

In light of these realities, we need the WTO to stand strong as it approaches its 30th anniversary.

We need to keep reforming and reinvigorating the WTO so that it can deliver for trade in the years ahead: seizing the full potential of services and digital trade, accelerating trade for the green transition, and fostering socioeconomic inclusion.

We took important steps in the right direction at MC12. We have continued this work in Geneva under the aegis of the General Council, making significant advances on reform-by-doing. I will come back to those shortly, but I want to thank ambassadors for these achievements. We need to build on these successes here in Abu Dhabi this week. This is why I am excited about the deliberative sessions we have planned for ministers.

This is something new that we are trying for the first time and we very much view this as part of WTO reform. We have two deliberative sessions, one on trade and sustainable development in all its dimensions - social, environmental, and economic. With respect to the economic dimension, issues of industrial policy and policy space will be important. The second session is on trade and inclusion. These sessions are intended to provide space for Ministers to engage on issues at the centre of contemporary economic debate and the intersections with the future of trade policy – issues on which we need ideas and ways forward even if they are not on the formal agenda. We have put questions to ministers to facilitate constructive discussions. These sessions are an experiment – one that I hope will go well so that we can replicate that in the future.

Now, let me look at some of the other issues on the table before you.

At MC12, members delivered the first-ever WTO agreement with environmental sustainability at its core. The Fisheries Subsidies Agreement fulfilled the mandate in Sustainable Development Goal target 14.6, and contributed to several others, including target 14.4, making fishing sustainable, and 14.2, restoring marine ecosystems. This week ministers can finish the job by closing the loop on some outstanding issues relating to harmful subsidies that contribute to overcapacity and overfishing.

We are well on our way to seeing the entry into force of Fish I. Completion of Fish 2 and its rapid entry into force would really put WTO members at the forefront of action on sustainability of our oceans and would safeguard the livelihoods of the 260 million people who depend on these oceans.

Let me take a moment here to thank the International Institute for Sustainable Development, the Pew Charitable Trust, the Stop Funding Overfishing coalition, the Friends of Ocean Action and other civil society groups for their analytical work to help us understand what is at stake – and for the advocacy that has kept our feet to the fire.

Ending the estimated $22 billion per year in harmful fisheries subsidies would free up resources that subsidisers can repurpose, whether to help people domestically or to help the wider world, such as through green financing for poor countries, or to support for climate-related loss and damage.

Turning now to agriculture, according to the FAO, nearly ten percent of the global population is undernourished – 735 million people in 2022, over 120 million more than before the pandemic. Trade has helped bring global food prices down from record peaks, though poor households continue to face difficulties accessing food amid high domestic inflation. Our decisions at MC12 are making a difference: the World Food Programme has told us that the exemption from export restrictions which members approved has made it easier for it to procure and distribute food for those who need it. But as you know, at MC12 we were not able to deliver an outcome on updating the agriculture rulebook. Given the centrality of the issue, this week I implore you to deliver an agriculture outcome at MC13 even if it is setting the platform to do better or more solid work going forward.

Development is at the core of everything we do at the WTO. But developing countries have tabled some specific asks. The LDCs have been working for some years on how to smoothen the transition of members graduating from this category including the transition period over which they can still access special and differential treatment available to LDCs. I have good news for you - that an agreement on some of the LDC asks which Ministers can hopefully bless in a Ministerial decision has been reached while work continues on other aspects. There are also requests by the G-90 group to look at Special and Differential Treatment in some agreement specific proposals such as in the Technical Barriers to Trade (TBT) and Sanitary and Phytosanitary Measures (SPS) agreements which will no doubt require some discussion by ministers on the way forward to strengthen work on these issues in the Committee on Trade and Development Special Session (CTDSS) in conjunction with the SPS and TBT Committees.

We know digital trade is the wave of the future. For years, the e-commerce moratorium has been extended, providing a measure of predictability to the global digital economy, now creating millions of jobs, especially for young people and women around the world. At the same time, some members have questioned the value of the moratorium and pointed to its impact on government revenue and the advantage it provides to Big Tech to consolidate power. A great deal of evidence-based work is now available that we hope could be helpful to Ministers to enable them to make the right decision.

Now for the topic you have probably been waiting for with bated breath: reform. Let me first highlight the important progress that has already been made on what delegates call 'reform-by-doing'. Members have already moved ahead with over 100 small-scale measures, like digital tools for transparency and improved databases, that add up to more efficient and effective work in WTO councils, committees, and negotiating bodies, and easier participation for members, particularly for small delegations. Senior officials recognized the importance of these reforms when they met in Geneva last October.

On the high priority issue of dispute settlement reform, ambassadors have heeded ministers' charge to work on delivering a fully and well-functioning system accessible to all Members by 2024. Ministers will be considering an important Ministerial Decision in this regard. Considerable work has been done and progress made, through an informal process ably led by former Guatemala Deputy Permanent Representative Marco Molina, which has produced a draft consolidated text. Several members have also submitted critiques of this and their own papers. But we are not all the way there yet. I would like to thank the USA, indeed all members and in particular, Marco Molina for the progress made. That said, there are some members who would like to formalize the process under the Dispute Settlement Body post-MC13 while other members, especially small economies and LDCs, have stated that they would like to find ways to participate more fully in the work going forward. I hope Ministers will recognize the progress made through the various contributions and will instruct their teams in Geneva to accelerate discussions, build on progress and work on unresolved issues, including a peer review accessibility to achieve convergence and meet the MC12 mandate. Reforming dispute settlement is also an essential mandate as a multilateral organization that sets and enforces the global rules for trade.

At the same time, I want to emphasise Excellencies that members are still using the dispute settlement system to resolve disputes, sometimes in very creative ways. The panel level is quite active, with 12 active panels working on trade disputes, and nine ongoing bilateral consultations between members. Eight disputes have recently been settled bilaterally at the WTO, with seven more in the process of resolution. Alternative mechanisms to resolve disputes were always available at the WTO – but now members are making more use of them, including through article 25 on arbitration and the Multi-Party Interim Appeal Arbitration Arrangement. These important tools ensure that WTO rules are being followed.

In a fast-changing world, the WTO, as part of its reform, needs to operate with multiple instruments. Multilateral instruments continue to be the gold standard, but the WTO also has a proud tradition of some plurilateral arrangements. These include the Information Technology Agreement, which has removed tariffs on roughly $3 trillion worth of annual trade in products on which the digital economy depends, the Government Procurement Agreement, and now the Services Domestic Regulation Agreement. I am grateful to India, South Africa, and the EU for negotiating an approach that allowed the Services Domestic Regulation Agreement to go forward, paving the way for easier access to participating WTO members and economies by services providers from all WTO members. Ministers have an opportunity here to move forward on the plurilateral agreement on Investment Facilitation for Development that has been negotiated by 126 members, the vast majority of them, 90 in fact, developing and least-developed countries hoping to use the agreement to attract much-needed domestic and foreign investment.

Before I conclude Excellencies, let me say a word on what the Secretariat itself has been doing to underpin the issues members are grappling with. To preserve our multilateral trading system, the Secretariat has been doing cutting-edge work to estimate the costs of global economic fragmentation and these costs are significant, signalling the need to work hard to maintain the system we have. Furthermore, in a world where the future of trade is services, digital, and green, the Secretariat has done ground-breaking work on issues ranging from measuring trade in digitally-delivered services, to options for minimizing trade frictions associated with carbon pricing, and fostering convergence in carbon standards for steel. We supported the UAE to organize a 'trade day' at COP28, where we presented ten trade policy options that members could leverage to amplify the impact of climate action. And because the future of trade also has to be more inclusive, we are working on the supply side to broaden access to international market opportunities for people and places left behind by globalization. Through our work, we are advocating for the decentralisation and diversification of global supply chains to developing countries and regions left behind by the first wave of globalization. This is a concept we term Re-Globalization. It will help the world build resilience in supply chains whilst fostering inclusion. Other examples of work designed to foster inclusion is our partnership with the World Bank to bridge the digital divide in eight pilot countries in Africa, with the International Finance Corporation to understand and plug trade finance gaps, and with the International Trade Centre to create a $50 million fund to support women exporters in the digital economy. We want to thank our host, the UAE, and the Gulf countries for an excellent launch of this fund yesterday with an initial contribution of $5 million by the UEAS and more in the pipeline soon. The Secretariat is also working on a vision and strategy for the first time to guide its work till 2030. The secretariat must be properly equipped to help members tackle 21st century issues. And in this regard, I want to thank members for approving a small budget increase for the Secretariat after 12 years of a flat nominal budget. Thank you. It was a moral booster for staff.

Excellencies, let me conclude by coming back to the agenda of deliverables I described earlier. Can we get all of this or some of it done? The answer is yes. But we will need something I mentioned before: leadership. Leadership means you sometimes have to compromise on certain wants, so that others can secure their wants. We will need your leadership from all members, large and small, developed and developing, in order to succeed here in Abu Dhabi

I am not for a moment suggesting that any member set aside national interests. I am asking that members wield these interests with the flexibility that would enable us to deliver important outcomes so we leave Abu Dhabi proud that we have a stronger WTO able to face the future and deliver for all members, all people and the planet.

Speaking at the end of the Bretton Woods Conference in 1944, US Treasury Secretary Henry Morgenthau said, and I quote: “We have come to recognize that the wisest and most effective way to protect our national interests is through international cooperation — that is to say, through united effort for the attainment of common goals.” He added that “the great lesson taught by the war is that the peoples of the earth are inseparably linked to one another by a deep, underlying community of purpose.”

That is a lesson that we should not lose sight of. Excellencies, dear friends let's get to work!⍐