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Policy Proposals  Trade, Investiment, EPA/FTA Call to Rebuild the WTO Multilateral Free Trade and Investment System

May 19, 2015
Keidanren

Summary

This year commemorates the 20th anniversary of the establishment of the World Trade Organization (WTO) and 60 years since Japan joined the General Agreement on Tariffs and Trade (GATT). The focus of trade strategies among countries including Japan, however, has shifted from the WTO to mega-free trade agreements such as the Trans-Pacific Partnership (TPP) and the EU-Japan Economic Partnership Agreement (EPA). The main reason for this trend is that the WTO's rule-making function is in a state tantamount to being non-functional, as seen in an impasse in the Doha Round (DDA: Doha Development Agenda) of WTO negotiations.

Multilateral system for free trade and investment is essential for the global economy as well as for Japan, which heavily depends upon trade and investment for its prosperity. Therefore, reinforcement of the functions of the WTO, the institutional foundation of the multilateral framework, is an urgent issue. This proposal thus proposes five measures toward WTO reforms, above all, reviving and strengthening its rule-making function.

  1. Given that there is no prospect of concluding the Doha Round in the near future, it is necessary to bring the round to a close promptly and start new negotiations.

  2. For post-Doha negotiation, the consensus approach and the single undertaking approach should be reviewed and rules that govern negotiations must be made easier to tackle fields that are not covered in the current WTO agreements, such as information and communication technology (ICT), investment, competition policy and environmental issues.

  3. An appropriate part of the results of ongoing trade negotiations such as the TPP should be converged into WTO agreements.

  4. Transparency of the negotiations should be promoted, a timeframe should be set, and a work plan for evaluating the progress of negotiations should be drawn up.

  5. To reinforce political commitments to the negotiations, holding of regular annual WTO ministerial conference and high-level officials' meetings should be considered.

Trade, Investiment, EPA/FTA