Phil Hogan

EC Trade Commissioner Phil Hogan withdraws his name from consideration for WTO Director-General

An Bloomberg article last week indicated that the Irish Government would be nominating Phil Hogan as a candidate for position of next Director-General of the World Trade Organization.

Today, Commissioner Hogan issued a statement indicating that he would not be putting his name forward in light of the important trade issues facing the EU and the expected delays in completing the selection process which would require him to be absent for a considerable period from the EC Commissioner post. See Statement by Commissioner Phil Hogan on election of new WTO Director-General, 29 June 2020, https://ec.europa.eu/commission/commissioners/2019-2024/hogan/announcements/statement-commissioner-phil-hogan-election-new-wto-director-general_en. The statement is embedded below.

Statement-by-Commissioner-Phil-Hogan-on-election-of-new-WTO-Director-General-_-European-Commission

The announcement leaves the number of candidates at five (Jesus Seade Kuri from Mexico, Dr. Ngozi Okonjo-Iweala from Nigeria, Abdel-Hamid Mamdouh from Egypt, Tudor Ulianovschi from Moldova, and Yoo Myung-hee from Korea). None of the candidates is from a developed country (as understood within the WTO). Some have suggested that the WTO has moved to an informal rotation between developed and developing Member candidates when selecting a Director-General. Since Roberto Azevedo is from a developing country (Brazil), following that logic, WTO members should, assuming well qualified candidates from both developed and developing countries, select a developed country candidate. Indeed the last four Directors-General have come from developed (New Zealand), developing (Thailand), developed (France), and developing (Brazil) countries. Others argue that selection should be from a geographic area that hasn’t held the Director-General position or hasn’t held the position recently. The WTO Members from Africa are stressing that view, and there are two candidates from African countries among the five. There is also interest in having a qualified woman take the Director-General position as there has never been a woman in the DG slot.

The nominating period ends at the close of business on July 8. It is not clear if some other European from the European Union will be nominated (e.g., Spain could nominate Arancha Gonzalez Laya, the current Spanish foreign minister; she has been mentioned in various press accounts as a possibility) or whether one or more nominations may yet come from other developed or developing countries. Canada, Japan, Australia, New Zealand, Norway, Switzerland from the developed world all have experienced current or past officials. The United States historically has not nominated individuals and will presumably not do so this time. There are many other Members who consider themselves to be developed who might also submit a candidate, though that seems less likely with the current group of candidates.

Today’s Financial Times provides its analysis of Commissioner Hogan’s withdrawal. See Financial Times, June 29, EU trade commissioner Phil Hogan abandons interest in WTO role, https://www.ft.com/content/f94683c0-5020-4570-8a14-85bb13016f6a.

Will the EC Trade Commissioner Phil Hogan be nominated by Ireland for the WTO Director-General position?

There have been many news articles over the last few weeks on the possibility of Phil Hogan being nominated by Ireland as a candidate for the Director-General position at the World Trade Organization (“WTO”). See, e.g., Politico, May 30, 2020, European trade chief mulls bid for WTO top job, https://www.politico.com/news/2020/05/30/phil-hogan-wto-european-union-290660. The WTO is in the middle of the period for receiving nominations, a period which began on June 8 and will end on July 8. To date five candidates have been put forward from Mexico (Jesus Seade Kuri), Nigeria (Dr. Ngozi Okonjo-Iweala), Egypt (Abdel-Hamid Mamdouh), Moldova (Tudor Ulianovschi) and the Republic of Korea (Yoo Myung-hee).

Commissioner Hogan has indicated he has been thinking about the possibility. See, e.g., Irish Times, June 9, 2020, Phil Hogan confirms he is weighing bid to become WTO chief, https://www.irishtimes.com/news/politics/phil-hogan-confirms-he-is-weighing-bid-to-become-wto-chief-1.4274865. There have been articles about the European Union seeking a candidate all EU countries would support and certain ethical limitations on a sitting Commissioner seeking another position. See, e.g., Reuters, June 9, 2020, EU weights single bid for WTO job, trade chief Hogan confirms interest, https://www.reuters.com/article/us-health-coronavirus-eu-trade/eu-weighs-single-bid-for-wto-job-trade-chief-hogan-confirms-interest-idUSKBN23G1RE; Financial Times, June 16, 2020, https://www.ft.com/content/c45a56ab-5b2d-4a8c-af83-6aedec645bff.

A Bloomberg report on June 23 indicated that Ireland would be submitting his nomination and that Commissioner Hogan would announce his candidacy on Thursday (today), though delays for unspecified reasons have apparently occurred. Bloomberg, June 23, 2020, Ireland to nominate EU Trade Chief Hogan for Top WTO post, https://www.bloomberg.com/news/articles/2020-06-23/ireland-to-nominate-eu-trade-chief-hogan-for-top-wto-post. As of 5 p.m. Geneva time, no nomination has been received and there are no updates on Commissioner Hogan making an announcement.

The EU webpage for Commissioner Hogan provides the following shorthand biography of positions held over the last thirty-three years:

Biography

  • European Commissioner for Trade2019 – present
  • European Commissioner for Agriculture and Rural Development2014-2019
  • Minister for Environment, Community and Local Government, Ireland2011-2014
  • President of the Council of EU Environment Ministers2013
  • Minister of State at the Department of Finance, Ireland1994-1995
  • Member of Dáil Éireann (Lower House of Parliament)1989
  • Member of Seanad Éreann (Upper House of Parliament)1987-89

If Commissioner Hogan is nominated in the coming days, he will be the first candidate from a country that is a “developed” country Member of the WTO. To the extent WTO Members look at having the Director-General from a developed country versus a developing country following DG Azevedo’s departure on the thought that there should be rotation between developed-developing country leadership, then Commissioner Hogan would be the first (and to date, only) developed country candidate. The candidate from the Republic of Korea may view herself as from a developed country, though Korea has self-declared itself a developing country at the WTO though has agreed not to seek special and differential treatment in future agreements.

Other possible positives for Members will be his experience in trade (first agriculture and now trade overall), his political and his technical competence, his support of the WTO overall, his support for reform at the WTO.

Challenges for Commissioner Hogan’s candidacy may include the number of European Directors-General there have been at the WTO (and at the GATT before then) suggesting those wanting geographical diversity of leaders may be less interested in another European. Commissioner Hogan will also have potential challenges based on positions he has taken on behalf of the European Union on important issues before the WTO (e.g., United States on dispute settlement and whether convergence or coexistence is a key need for WTO Members). Candidates are obviously expected if selected to be the next Director-General to be honest brokers and facilitators and not to be representing the views of the Member who nominated them. But in an environment in which there are fundamental differences in views of existing rights and obligations and the needs of the WTO, it is possible that Commissioner Hogan will have a special challenge in demonstrating his neutrality and openness to all issues and views.

Conclusion

With thirteen days left in the WTO DG nomination process, there are five candidates who have been put forward. It is likely that several more will be put forward before the close of the process on July 8. It appears that the European Commissioner Phil Hogan will be nominated in the coming days by Ireland which would expand the field of candidates to six. It is unclear if the delay in the announcement of his nomination that was apparently originally scheduled for today, June 25, flows from internal EU or Irish logistics, from a lack of consensus within the EU member countries to support Commissioner Hogan or reflects some other issue that simply delays the timing and not the likelihood of his nomination.

Selecting a new WTO Director-General — “the game is afoot”; Mexico’s Jesus Seade Kuri is the first nominee

June 8, 2020 is the start of the one month process for WTO Members to put forward a nomination of a national to be considered for the position of the next Director-General. All nominations must be submitted to the Chair of the General Council by the close of business (Geneva time) on July 8. Using a term first expressed by Shakespeare in King Henry IV Part I but probably better known as uttered by Sir Arthur Conan Doyle’s Sherlock Holmes, “the game is afoot”.

There is little doubt that the selection of the next Director-General of the WTO will be important for an organization struggling from major divisions within its membership on direction, need for reform, and ensuring continued relevance while looking for collective action during the COVID-19 pandemic to facilitate trade and minimize the damage to Member and global economies.

In prior posts, I reviewed the general procedures that the WTO will follow in conducting the selection process and thoughts on how to expedite the selection process if WTO Members want to find a replacement before the current Director-General departs at the end of August. See World Trade Organization – Search for a new Director-General, https://currentthoughtsontrade.com/2020/05/15/world-trade-organization-search-for-a-new-director-general/; WTO selection of a new Director-General – one individual from a developed country previously reviewed could shorten the process, https://currentthoughtsontrade.com/2020/05/19/wto-selection-of-a-new-director-general-one-individual-from-a-developed-country-previously-reviewed-could-shorten-the-process/.

Potential nominees

The WTO Secretariat will be posting the names of nominees and their CVs as they are received. As of 5:15 p.m. Geneva time on June 8th, the WTO had listed the first nomination to be received, Jesus Seade Kuri nominated by Mexico. https://www.wto.org/english/news_e/news20_e/dgsel_mex_08jun20_e.htm.

Jesus Seade is a former Ambassador to the GATT, a former Deputy Director-General at the WTO and recently involved in concluding the U.S.-Mexico-Canada Agreement as Deputy Secretary for North America. Press from earlier today noted his nomination.https://www.bloomberg.com/news/articles/2020-06-08/mexico-to-nominate-seade-as-its-wto-candidate-el-universal; https://business.financialpost.com/pmn/business-pmn/mexico-to-nominate-seade-as-its-wto-candidate-el-universal. The WTO news contains his CV which is embedded below.

bio_mex_e

Information on other potential nominees is from press or other sources and doesn’t reflect information on actual nominations received by the WTO by the afternoon of June 8.

Press accounts over the weekend indicate that Nigeria has changed their desired candidate from Yonov Frederick Agah (currently one of the WTO’s Deputy Director-Generals) to Ngozi Okonjo-Iweala, a former Nigerian finance minister and former World Bank official. https://www.bloomberg.com/news/articles/2020-06-05/nigeria-nominates-okonjo-iweala-as-wto-director-general.

At least two other African officials are being considered by the African Union, a candidate from Egypt, Hamid Mamdouh, and a candidate from Benin, Eloi Laourou. Mr. Mamdouh is a former WTO Secretariat Director of the Trade in Services and Investment Division and now working for a law firm. https://www.kslaw.com/people/abdelhamid-mamdouh. He also has a webpage being developed for any run for Director-General with a media kit. https://hamid-mamdouh.com/. H.E. Mr. Eloi Laourou is the current Benin Ambassador and Permanent Representative to the WTO (and to UN entities in Geneva).

It appears that the African Union will be holding a meeting by video- conference this week in an effort to see if there is agreement on one candidate for the African Union countries.

European countries are also considering potential candidates including possibly European Commissioner for Trade Phil Hogan (Ireland) and Spain’s Foreign Minister Arancha Gonzalez (she previously served as Chef de Cabinet for Director-General Pascal Lamy). See, e.g., https://www.irishtimes.com/news/politics/phil-hogan-exploring-idea-of-wto-director-general-role-1.4266073; https://www.bloomberg.com/news/articles/2020-05-23/spain-foreign-minister-gonzalez-favorite-to-lead-wto-wiwo-says.

And there will undoubtedly be more Members considering whether to nominate an individual to be considered in the selection process.

The process is intended to focus first on qualifications, and then if there are equally qualified individuals, “Members … shall take into consideration as one of the factors the desirability of reflecting the diversity of the WTO’s membership in successive appointments to the post of Director-General”. WT/L/509 para. 13. For example, no individual from Africa has previously served as the Director-General (“DG”) of the WTO.

Other factors besides geographical location of the nominee could be whether the nominee is from a developed or developing country and whether the candidate is male or female.

Press has indicated that the EU is seeking a developed country DG in light of the fact that the last DG is from a developing country (Brazil). Indeed, the last four DGs have rotated between developed and developing country nominees. Other developed countries (besides EU members) would include the United Kingdom, Norway, Switzerland, Iceland, Canada, United States, Japan, Australia, New Zealand and possibly a few others. The United States has never put up a candidate and is unlikely to do so this time either, but has apparently communicated with Australia a desire to broaden the group of candidates.

As all WTO DGs up to the present have been male, if there are equally qualified male and female candidates, this may be a factor considered by Members.

Expediting the process?

Press accounts indicate an expressed desire to find a replacement for DG Azevedo by the end of August. This seems a nearly impossible objective in light of travel limitations from efforts to control the pandemic, the likely number of candidates and the normal closure of the WTO to most business during the month of August.

But the agreed procedures do permit expedition of the process if agreed by the Members. WT/L/509 para. 23.

It is understood that the General Council meeting with all candidates may be held the week immediately after the close of the receipt of nominations, i.e., the week of July 13. If correct, this approach would have this step occur three weeks earlier than the comparable timing during the 2012-2013 DG selection process when the General Council meeting happened January 29-31 after the nomination process concluded on December 31.

Whether other steps to expedite the process are possible will depend on the will of the Members, limited by the obligation “to be guided by the best interests of the Organization, respect for the dignity of the candidates and the Members nominating them, and by full transparency and inclusiveness at all stages.” Appointment of the Next Director-General, Communication from the Chairman of the General Council to Members, JOB/GC/230 (20 May 2020).

An obvious area where time could be saved would be the three month time frame that candidates have to get themselves known to Members. With travel limitations, meetings with Members in Geneva and in capitals will presumably have to happen virtually. It is possible that governments could agree to a one month period for such outreach by candidates but would require availability of Missions and of officials in capitals with an interest to meet the candidates. If handled during the first month of the post-nomination process, this would suggest conclusion by August 8 (with possible frontloading of meetings for Members who will not extend general operations into August).

If handled on such an expedited basis, the Chairman of the General Council and his two facilitators could do “confessionals” during August to reduce the field of candidates to the one deemed most likely to achieve consensus by the end of the month with a General Council meeting set for Friday, August 28 to permit confirmation of the candidate (if consensus is achieved). Such an timeline would permit a new DG to be confirmed one business day before the departure of DG Azevedo.

To achieve such an outcome, either WTO Members would need to remain in Geneva during August or permanent representatives would need to be reachable and able to provide input during the month and all would need to be amenable to participating in the GC meeting (possibly remotely for some) at the end of August.

If such expedition is not possible, then Para. 23 of the procedures (WT/L/509) calls for the selection by consensus of an acting Director-General from among the four current Deputy Directors-General.

If the full six months to a decision are needed, this would suggest the General Counsel meeting in early December to meet the December 8 timeline. Nothing in the procedures requires a new Director-General to wait three months after confirmation before taking up the position when there is a vacancy/use of an Acting Director-General.

Of course, the objective for the selection process is consensus. While voting is an option, if there were failure to achieve a consensus through the procedures agreed to in 2002, Members could continue to meet with the Chairman of the General Counsel and his facilitators to attempt to achieve consenus. They could also take the extraordinary step of voting although such an approach on a new Director-General would likely have significant negative effects from the imposition of a DG opposed by some significant part of the membership.

Conclusion

As the game is now afoot for the selection of a new Director-General, one can expect a lot of energy of trade officials to be diverted in coming weeks to examining the candidates and choosing preferred candidates. It is clear that there will be a significant number of candidates put forward in the coming weeks which will complicate the ability to expedite the selection process. WTO Members could significantly expedite the process if willing to telescope meetings with candidates virtually and remaining available for decisions and confessionals during August.

We should know in a few weeks whether Members have agreed to a process to find a new DG before DG Azevedo departs or whether there will be some period of time where an acting DG is needed.