United Kingdom

As November approaches, Europe and the United States facing rapidly growing new COVID-19 cases

The number of new cases of COVID-19 reported globally skyrocketed during the October 12-25 period (5,431,119), up 24.37% from the September 28 – October 11 period (4,336,825). Data are from the European Centre for Disease Prevention and Control worldwide update series. Global confirmed cases to date are now 42,758,015.

The United States which has more confirmed cases (8,576,725) than any other nation and more confirmed deaths from COVID-19 (224,899), saw the number of new cases surge by 34.0% over the last two weeks with daily records set twice in the last week (both days over 80,000 new cases). The U.S. recorded the extraordinary number of 908,980 new cases during the fourteen day period July 20-August 2. That number declined to 740,721 during August 3-16 and further declined to 600,417 new cases in the August 17-30 period and was further reduced to 524,526 new cases in the August 31-September 13 period. The downtrend was reversed during September 14-27, when the number of new cases increased to 592,690 or a daily average of 42,335 cases. During September 28-October 11, the United States recorded 640,149 new cases (45,725/day). During October 12-25, the United States recorded 857,778 new cases and will likely surpass the prior two week peak in the next two weeks.

The United States regained the dubious distinction of recording the largest number of new cases in the last two weeks as India’s number of new cases continues to decline to 811,005 new cases from its peak of 1,238,176 new cases during the September 14-27 period. India is the only country to have recorded more than one million cases in a two week period. The United States appears likely to join India in the coming weeks.

Brazil (297,998 new cases) lost its hold on third place to France (367,624 new cases). Brazil’s new cases have been falling since July 20-August 2 (633,017 new cases) to 609,219 new cases during August 3-16, 529,057 new cases during August 17-30, 469,534 new cases during August 31-September 13, 402,304 new cases during September 14-27, 364,646 during September 28-October 11 and 297,998 new cases in October 12-25 (a decline of 52.92% since the end of July).

With the tremendous overall global growth and the declining volume of new cases in India and Brazil, the share of total new cases in the last fourteen days and since the end of December 2019 accounted for by India, Brazil and the United States declined to 36.21% in the most recent fourteen days from 47.31% in September 28-October 11. and from 54.33% during September 14-27 and down from 58.34% in the August 31-September 13 period. The three countries account for 51.04% of total cases since late December 2019 in the prior two weeks down from 53.25% of all cases confirmed since late December 2019 as of October 11.

The United States with 4.3% of global population has accounted for 20.06% of total confirmed cases since December 2019 — 4.67 times the share of total cases our population would justify. With the large increase in the most recent two weeks, the U.S. was 15.79% of the total new cases during the last two weeks (up from 14.66% during Sept. 28-October 11) or 3.67 times the U.S. share of global population. The U.S. also accounts for 19.53% of total deaths or 4.54 times the U.S. share of global population.

Changing pattern of growth in cases, Europe experiencing a spike in cases surpassing its first wave

Much of Europe is in a massive build-up of new cases, rivaling or exceeding the challenges faced during the March-April time period. This is resulting in reimposition of some restrictions by some European countries with a fair amount of pushback from citizens weary of the restrictions.

France has been hit hardest in terms of the number of new cases with the October 12-25 number of new cases reaching 367,624 up 92.04% from the 191,427 new cases in September 28-October 11 which was up from 153,535 in the September 14-27 period. The current number of new cases compares to the prior peak in the March 30-April 12 period of 56,215 new cases (or is 6.54 times the prior peak in the latest two week period).

The United Kingdom is similarly facing major challenges as the last two weeks saw new cases of 263,166 up 62.88% from the 161,567 new cases in September 28-October 11 which was more than twice the 64,103 new cases in September 14-27 and just 32,422 new cases in the August 31-September 13 period. The United Kingdom’s prior peak in the April 13-26 period was 69,386 new cases. So the most recent two weeks is at a level that is 3.79 times the prior peak.

Spain’s number of new COVID-19 cases rose to 185,020, an increase of 27.93% rom the September 28-Ocotber 11 period with 144,631 new cases. Spain’s peak in the spring had been in the period March 30-April 12 with 81,612 new cases. Thus, the last two weeks were 2.27 times the Spring peak number of new cases.

Italy’s last two weeks saw a breathtaking spike to 155,015 new cases, 3.74 times the number of new cases from the prior two week period September 28-October 11 when Italy recorded 41,390 new cases which was nearly double the number of cases in the September 14-27 period (21,807 new cases). Italy’s most recent two weeks was 2.59 times the prior peak for Italy in the Spring during the March 30-April 12 period of 59,799 new cases.

Czechia which spiked following summer vacations saw its number of new cases during October 12-25 surge to 136,790 up from 46,080 new cases in the September 28-October 11 period and 23,893 new cases in the September 14-27 period and 11,307 new cases in the August 31 – September 13 period. Czechia largely escaped the March-April wave in Europe. The data for the last eight weeks constitutes 86.95 percent of Czechia’s total recorded cases since December 2019.

Belgium surged to 133,439 new cases in the October 12-25 period more than tripling the 40,791 new cases recorded in the September 28-October 11 period which more than doubling the numbers from September 14-27 of 17,797.

Poland, which had largely escaped the Spring wave of infections, recorded 120,308 new cases in the latest two week period (Oct. 12-25) up from 35,658 new cases in the September 28-October 11 period.

The Netherlands nearly doubled its number of new cases in the October 12-25 period (112,649) compared to the number of new cases in the September 28-Ocotber 11period (59,561). The last two weeks constitute 40.13% of total cases the Netherlands has recorded since December 2019.

Germany’s new cases in the October 12-25 period surged to 106,317 from 38,724 new cases during the September 28-October 11 period. The Spring peak for Germany had been during the March 30-April 12 period (67,932 new cases).

The Russian Federation saw continued increases in the number of new cases during the October 12-25 period (228,793) up from 141,513 in the September 28-October 11 period which was up 86,209 new cases in the September 14-27 period. Russia’s earlier peak was during the May 11-24 period when Russia recorded 137,206 new cases.

Ukraine recorded 81,144 new cases during the October 11-25 period compared to 60,762 new cases in September 28-October 11, and 43,645 new cases in the September-27 period.

Many other European countries saw large increases as well in the last two weeks, though the number of new cases are smaller those the countries reviewed above.

Developing country hot spots

Still a very large part of the new cases are in developing countries as has been true for the last few months although many countries, including India and Brazil are seeing many fewer new cases in the last two weeks. While India and Brazil had by far the largest number of new cases from developing countries, they were followed by Argentina (197,440), Colombia (104,964), Iran (66,452), Indonesia (57,028), Mexico (55,807), Iraq (49,029), Morocco (48,063), Peru (40,126), the Philippines (30,893), Turkey (25,753), South Africa (23,350), Chile (20,947), Bangladesh (20,434) and then dozens of other countries with smaller numbers of new cases. Of the listed developing countries, only Argentina, Colombia, Iran, Morocco, Turkey and South Africa saw increases from the September 28-October 11 period.

Deaths/100,000 population

The United States has the largest number of deaths of any country to date (224,899) and had the largest number of deaths in the last two weeks (10,522). Because the number of deaths typically follows increases in new cases (with a significant lag), the U.S. saw the number of new deaths increase 6.5% from the prior two weeks deaths (9,880). The countries with the highest number of deaths per 100,000 population for the last two weeks were the following: Argentina (11.24), Armenia (5.54), Moldova (5.22), Israel (5.06), Romania (4.94), Belgium (4.91), Iran (4.86), Colombia (4.65), Costa Rica (4.08), Mexico (4.00), Poland (3.63), Panama (3.44), Chile (3.27), and the United States (3.20). All other countries (including all other developed countries) had lower rates of death per 100,000 population. For all countries, the death rate over the last two weeks was 1.02 deaths/100,000 population. So the U.S.’s death rate over the last two weeks was 2.91 times the global average and was much higher than many large and/or developed countries. China’s number was so low, it was 0.00 people/100,000 population; France was 2.93, Germany 0.50, India 0.75, Italy 1.77, Japan 0.07, South Korea 0.05, Singapore 0.02, United Kingdom 2.98, Taiwan 0.00, Canada 0.90, Australia 0.03, New Zealand 0.00.

If looking at the entire period since the end of December 2019 through October 25, the average number of deaths for all countries per 100,000 of population has been 15.16 deaths. The nine countries (of 86 which account for over 98% of total deaths) with the highest death rates/100,000 for the full period are: Peru (10.87), Belgium (93.73), Bolivia (74.93), Brazil (74.34), Spain (74.04), Ecuador (72.19), Chile (73.30), Ecuador (72.19), Mexico (69.56), the United States (68.34). The United States death rate has been 4.51 times the global rate and many times higher than nearly all other developed countries and most developing countries. Consider the following examples: China, where the virus was first found, has a death per 100,000 population of just 0.33 people. India’s data show 8.67 per 100,000 population; Germany has 12.08; Japan has 1.35; Korea is just 0.89; Canada is 26.52; Switzerland is 21.96; Poland is 11.46; Ukraine is 14.30; Norway is 5.24; Australia is 3.59; New Zealand is 0.52.

Conclusion

The world in the first ten months of 2020 has struggled to get the COVID-19 pandemic under control. While many countries in Europe and some in Asia and the major countries in Oceania had greatly reduced the number of new cases over time, there has been a significant resurgence in many of these countries (particularly in Europe where current rates of new cases are greater than during the March-April initial wave) as their economies reopen, travel restrictions are eased, schools reopen in many countries and fall comes to the northern hemisphere. But the number of new cases continues to rage in a few countries in the Americas, with the United States heading to new records. While there are growing number of cases in many developing countries in Asia and Africa, many countries are seeing significant declines with relatively smaller number of cases in Africa in total than in other continents.

A recent WTO Secretariat information paper showed that there has been a reduction in shortages of many medical goods needed to handle the COVID-19 pandemic which is obviously good news, although as the global total of new cases continues to rise, there may yet be additional challenges in terms of supply. See 18 September 2020, Information Note, How WTO Members Have Used Trade Measures to Expedite Access to COVID-19 Critical Medical Goods and Services, https://www.wto.org/english/tratop_e/covid19_e/services_report_16092020_e.pdf.

Despite significant expansion of production of PPE around the world and despite progress within GAVI on its program for outreach with various vaccines when developed (including securing production capacity in a number of countries), and other relevant medical goods and the ongoing efforts of CEPI on vaccine developments, and the license agreements that have been entered into by a number of the major groups developing vaccines for COVID-19, India and South Africa have filed a waiver request from most TRIPs obligations “in relation to prevention, containment of treatment of COVID-19”. The waiver request would apply to all WTO Members for a number of years (yet to be determined). See Communication from India and South Africa, Waiver from Certain Provisions of the TRIPs Agreement for the Prevention, Containment and Treatment of COVID-19, 2 October 2020, IP/C/W/669. While I will address the waiver request in a later post, it is hard to imagine that the normal requirements for seeking a waiver have been met with the current communication. Based on the readout of the October 20, 2020 TRIPs Council meeting, it is likely that the waiver request will generate significant controversy in the coming three months and could complicate current efforts at greater global cooperation in addressing the pandemic.

With the third round of consultations for a new Director-General concluding on Tuesday, October 27, whoever the new Director-General ends up being can add the waiver request to the list of highly controversial matters that confront the WTO heading towards the end of 2020.

COVID-19 new cases over last 14 days pass 5,000,000 for first time on October 22.

According to data compile by the European Centre for Disease Prevention and Control, total new COVID-19 cases reported globally reached 5,042,415 for the last fourteen days on October 22, 2020 bringing the totals since data started to be gathered at the end of 2019 to 41.299 million cases. See European Centre for Disease Prevention and Control, October 22, 2020, COVID-19 situation update worldwide, as of 22 October 2020, https://www.ecdc.europa.eu/en/geographical-distribution-2019-ncov-cases. This is the first day where the two week total exceeded five million. The most recent two week total compares to 3,780,469 new cases for the two weeks ending on September 13; 3,019,983 new cases for the two weeks ending on July 19; 1,932,024 new cases for the two weeks ending on June 21; and 1,281,916 new cases for the two weeks ending on May 24.

While vaccines are available in China and the Russian Federation to some extent and emergency approval of two vaccines may be presented to the U.S. Food and Drug Administration in the second half of November 2020, countries is the Americas and Europe in particular are seeing sharp increases in the number of new cases as cooler weather and greater time indoors accompanies the start of Fall.

Here are all countries (13) that had 100,000 new cases or more in the last two weeks according to the ECDC report. They account for 3,605,666 of the cases in the last two weeks (71.5%). All but India and Brazil are increasing, most dramatically:

India – 871,291 (down from recent periods)

United States – 786,488 (increasing)

France – 303,912 (increasing)

Brazil – 298,078 (down from recent periods)

United Kingdom – 244,954 (increasing)

Russian Federation – 198,716 (increasing)

Argentina – 196,410 (increasing)

Spain – 169,394 (increasing)

Italy – 115,708 (increasing)

Czechia – 113,555 (increasing)

Colombia – 104,017 (increasing)

Netherlands – 103,024 (increasing)

Belgium – 100,119 (increasing)

Individual countries in Europe are reimposing some restrictions in response to the sharp spike in new cases, including lockdowns in Ireland and Czechia. See Politico, October 21, 2020, EU leaders to discuss Coronavirus on October 29, https://www.politico.eu/article/eu-leaders-to-confer-on-pandemic-oct-29/. The EU has made arrangements with three groups developing vaccines for early supplies and is reported to be close to arrangements with three more (and possibly with a fourth).

Different states in the United States are responding to the rising number of new cases in different ways reflecting in part the politicization of prevention measures like wearing masks and the continued mixed messages coming from government officials on the pandemic. Rural America which had escaped most of the early infections has been going through large surges, particularly in the middle of the country and in the northern states in the midwest. Hospitalizations have increased in many states and will likely continue to climb if predictions of worsening new case counts continue to play out. The U.S. has made arrangements with a number of pharmaceutical companies and groups for early access to vaccines that receive approval for distribution.

In a recent WTO TRIPs Council meeting, the U.S. and U.S. reportedly opposed a proposal from India and South Africa to waive certain intellectual property protections for a period of time to address getting vaccines and therapeutics to all peoples when available. See World Trade Organization press release, October 20, 2020, Members discuss intellectual property response to the COVID-19 pandemic, https://www.wto.org/english/news_e/news20_e/trip_20oct20_e.htm; Inside U.S. Trade’s World Trade Online, October 20, 2020, U.S., EU oppose WTO effort to waive IP protections amid pandemic, https://insidetrade.com/daily-news/us-eu-oppose-wto-effort-waive-ip-protections-amid-pandemic.

As the pandemic continues to rage with a shifting focus on hot spots back to more developed countries and as vaccines get close to approval and mass production, the question of distribution of vaccines and therapeutics to countries in need will become a more pressing issue. While there has been greater international cooperation (with the exception of the U.S.) in supporting groups focuses on getting vaccines to developing and least developed countries, there obviously remains a tension between the role of government in taking care of its citizens and its role in contributing to global outreach. See Nature, 24 September 2020, Who Gets a Covid Vaccine First? Access plans are taking shape, https://media.nature.com/original/magazine-assets/d41586-020-02684-9/d41586-020-02684-9.pdf While the WHO would like to see all countries pool vaccines and make them available to vulnerable groups globally before addressing other national needs, that is a highly unlikely scenario among major producing countries. Particularly for developed countries experiencing large surges in new cases, the political pressure to address the immediate needs at home will likely rule government actions. The good news is that some pharmaceutical companies involved in vaccine development have plans to produce or license production in multiple countries, including in countries for broader distribution to developing and least developed countries. This is in addition to the government and private sector support to GAVI and others for obtaining vaccines and therapeutics and making them available to countries in need.

Conclusion

The spread of the COVID-19 pandemic continues to accelerate and will likely worsen for the Americas and Europe in the coming weeks. If there are increased restrictions by countries in an effort to slow the spread of the coronavirus, that will slow the economic rebound in important parts of the world and will likely slow the rebound in trade in goods and services.

At the same time, the world is getting close to knowing whether a number of the vaccine trials underway by western pharmaceutical companies have been successful and whether vaccines from these companies will join those of China and Russia. As vaccines and some therapeutics become commercially available, there will be the important challenge of seeing that all peoples with needs are able to access the vaccines and therapeutics on an equitable and affordable basis. The jury is out as to how access will actually work and whether the roll out of vaccines and therapeutics will in fact be equitable and affordable.

The effect of COVID-19 on the operation of WTO dispute settlement panels — Australia and others raise at the September 28 Dispute Settlement Body meeting

While most attention on the WTO’s dispute settlement system has focused on the operation of the Appellate Body, the timeliness of disputes is often driven by the actions of the panel. Under Article 12 of the Dispute Settlement Understanding (DSU), panels are to render their reports within six months (3 months in urgent matters) and no longer than nine months after the panel is composed. Few if any panels in recent years have remotely come close to meeting a nine month report deadline.

With the COVID-19 pandemic and the resulting limitations on in person meetings at the WTO and travel restrictions, the panel process has been further complicated. At the recent Dispute Settlement Body (DSB) meeting of September 28, Australia had put on the agenda the issue of “COVID-19 and dispute settlement”. Agenda item 9 of Proposed Agenda for the 28 September 2020 Dispute Settlement Body meeting, WT/DSB/W/670.

The subsequent press release on the DSB meeting contained the following description of the discussion of Australia’s issue on COVID-19 and dispute settlement.

Statement by Australia on COVID-19 and dispute settlement

“On behalf of 14 members (Australia; Brazil; Canada; Ecuador; Guatemala; Hong Kong, China; Mexico; New Zealand; Norway; Peru; Singapore; Switzerland; Ukraine; and the United Kingdom), Australia made a statement expressing concern about delays in dispute settlement proceedings resulting from the COVID-19 pandemic.

“While it is encouraging that DSB meetings have been able to resume at the WTO, ongoing restrictions affecting international travel and immigration place in question the feasibility of physical participation of panelists and capital-based delegates at meetings in Geneva into the future, Australia noted. During 2020, various governments, private sector organizations, and domestic and international adjudicative bodies worldwide have adapted their usual ways of working to continue operating in these difficult conditions; WTO members must ensure the dispute settlement system does the same.

“Australia urged panels to consider, in consultation with parties, flexible, alternative arrangements to ensure dispute proceedings can continue to progress in a timely manner despite the challenge of current restrictions. Australia recalled that Article 12.1 of the WTO’s Dispute Settlement Understanding (DSU) affords panels discretion in the working procedures they adopt in individual disputes, and that panels, after consulting in parties, may determine alternative arrangements that would best serve the satisfactory settlement of the matters. Some panels have already adjusted their procedures to hold substantive meetings virtually through video conferencing technology; Australia welcomed these developments but, to ensure the equitable operation of the dispute settlement system, WTO members must find solutions to enable all current and future matters to move forward in one way or another.

“Several delegations took the floor to comment. Japan said that while virtual meetings are an option, face to face meetings were preferable, and that each panel should consult with parties on how to proceed in order to strike an appropriate balance between prompt settlement of disputes and protection of due process. India said oral hearings were an intrinsic aspect of due process rights guaranteed by the DSU and that panels cannot truncate these rights without the agreement of the parties in a dispute.

“The United States encouraged each panel to consult with the parties on how to proceed, bearing in mind the views of the parties and the relevant provisions of the DSU. China said it was fundamental to provide certainty in dispute settlement in order to avoid any undue delay; it noted some panels have adopted flexible procedures as a response. The EU said that the discretion of panels is not completely unfettered and that they must ensure the prompt settlement of disputes, a principle that was valid for all disputes. Both South Africa and Nigeria (for the African Group) noted the asymmetrical impact of the COVID-19 pandemic on developing country members.”

WTO Dispute Settlement, 28 September 2020, Panel established to review China’s compliance with farm subsidy ruling, https://www.wto.org/english/news_e/news20_e/dsb_28sep20_e.htm.

The fact that Australia and others raised the issue at the DSB is certainly welcome, although the comments of Members at the DSB meeting indicates that there are both an array of problems facing different Members and arguably mixed motives for some in concerns about alternative approaches to in person meetings.

First, panels have regularly used the existence of the pandemic as a justification for a lengthy delay in the likely release of a panel report. See, e.g., India – Additional Duties on Certain Products from the United States, WT/DS585/4 (4 June 2020)(panel composed on 7 January 2020, because of pandemic, report to parties not before the second quarter of 2021); India – Measures Concerning Sugar and Sugarcane, WT/DS579/9; WT/DS580/9; WT/DS581/10 (29 April 2020)(complainants are Guatemala, Australia and Brazil)(panels composed on 28 October 2019, report to the parties not before the second quarter of 2021).

Thus, the issue of delay caused by the pandemic is an important one to address to maintain the timely operation of panels. While many developing countries may have greater challenges in terms of internal infrastructure for alternative means of handling disputes remotely, the claim of due process concerns at least for some Members is suspect particularly if the functioning of administrative and judicial activities in-country are being handled remotely/virtually as is true in many countries. For example, in the United States, arguments at federal courts are handled remotely, including at the highest court in the land. No Member should be allowed to delay panel proceedings on due process grounds where their own administrative and court proceedings are handled remotely during the pandemic. The Secretariat should seek transparency from Members on how their agencies and courts are handling matters during the pandemic.

Certainly, WTO Members should identify challenges they face to being able to engage in remote/virtual hearings if in person events are not possible. Where problems exist, the WTO Secretariat in conjunction with other organizations should look to see what technical assistance can be provided to permit active participation. Similarly, if issues affect the ability of panelists to handle matters remotely, there should be a review of options that may exist to facilitate panelists ability to participate. Again, the Secretariat should seek information from Members on challenges they face in participating in dispute proceedings and should have information on potential panelists on the same types of issues.

While the basic premises that panels should consult with parties is clearly the correct path to follow (contrary to the current practice of many panels and that reviewed in detail about the Appellate Body), there is the question of what happens when there is a difference among the parties as to how to proceed. The good offices of the Director-General can be used to possibly bridge the differences. Delay should only be permitted when the concerns of the party objecting to proceeding cannot be reasonably overcome.

It will be interesting to see if Members press for a prompt resolution to the concerns raised at the last DSB meeting, or if they simply let the problems continue to fester and delay the proper operation of panels.

World COVID-19 pandemic continues to spin out of control — more than 4.3 million new cases in last two weeks

After plateauing in terms of new cases during August, COVID-19 new cases are increasing rapidly for the world as a whole. For the period September 28-October 11, data compiled by the European Centre for Disease Prevention and Control show new cases in the world being 4,366,825 — an increase of 6.24% from the prior two weeks. Thee period September 14-27, dshow new cases i at 4,110,081. That compares to 3,780,469 new cases in the August 31-September 13 period and 3,558,360 for August 17-30, 3,624,548 for August 3-16 and 3,568,162 for the July 20-August 2 period. Total cases since the end of December 2019 are now at 37.268 million.

The United States which has more confirmed cases (7,718,947) than any other nation and more confirmed deaths from COVID-19 (214,377), saw the number of new cases increase over the last two weeks following the change in direction recorded in the prior two weeks after three two week periods where the U.S. saw a decline in new cases. The U.S. recorded the extraordinary number of 908,980 new cases during the fourteen day period July 20-August 2. That number declined to 740,721 during August 3-16 and further declined to 600,417 new cases in the August 17-30 period and was further reduced to 524,526 new cases in the August 31-September 13 period. The downtrend was reversed during September 14-27, when the number of new cases increased to 592,690 or a daily average of 42,335 cases. During September 28-October 11, the United States recorded 640,149 new cases (45,725/day). That number is likely to continue upward as recent days have seen the United States recording new cases at more than 50,000/day.

The United States had the second largest number of new cases, following only India whose number of new cases has started a slow descent from its peak of 1,238,176 new cases two weeks ago, with 1,061,274 new cases recorded during September 28-October 11. India is the only country to have recorded more than one million cases in a two week period.

Brazil maintains its hold on third place though its new cases are falling since July 20-August 2 (633,017 new cases) to 609,219 new cases during August 3-16, 529,057 new cases during August 17-30, 469,534 new cases during August 31-September 13, 402,304 new cases during September 14-27 and 364,646 during September 28-October 11.

India, the United States and Brazil accounted for 47.31% of the new global cases during the last two weeks, down from 54.33% during September 14-27 and down from 58.34% in the August 31-September 13 period. The three countries account for prior two weeks) and account for 53.25% of all cases confirmed since late December 2019.

The United States with 4.3% of global population has accounted for 20.70% of total confirmed cases since December 2019 — 4.81 times the share of total cases our population would justify. With the increase in the most recent two weeks, the U.S. was 14.66% of the total new cases during the last two weeks (Sept. 28-October 11) or 3.41 times the U.S. share of global population. The U.S. also accounts for 19.97% of total deaths or 4.64 times the U.S. share of global population.

Changing pattern of growth in cases, developing world still experiencing significant volume of new cases

As reviewed above the United States is seeing a rising number of cases over the last four weeks, a trend that unfortunately seems certain to continue in the near future.

Many developed countries have seen a second wave of cases, as will be reviewed below, which has increased the percent of global new cases occurring in developed countries.

Still a very large part of the new cases are in developing countries as has been true for the last few months. While India and Brazil had by far the largest number of new cases from developing countries, they were followed by Argentina (181,412), Colombia (96,709), Mexico (87,897), Indonesia (57,613), Iraq (54,155), Iran (53,167), Peru (45,496), the Philippines (35,670), Morocco (31,157), Chile (23,616), South Africa (21,398), Turkey (21,065), Bangladesh (19,200) and then dozens of other countries with smaller numbers of new cases. Of the listed developing countries, only Argentina, Mexico, Indonesia, Iran, Morocco, Chile and South Africa saw increases from the September 14-27 period.

Continued developed country resurgence in new cases

With the reopening of some international travel and with the end of the summer holiday season and the start of cooler weather in fall for northern hemisphere countries, there has been a noticeable surge of new cases in many developed countries, particularly in Western Europe where is it generally described as the coming of a second wave of COVID-19 cases.

France’s spike continued with 191,427 new cases in September 28-October 11 up from 153,535 in the prior two weeks. France’s most recent numbers are 3.36 times the number recorded in August 17-30 period (57,009 new cases) and 1.89 times the number in the August 31-September 13 period, 101,381.

Spain’s spike seems to have plateaued and started a decline in the September 28-Ocotber 11 period with 144,631 new cases. For August 17-30, Spain saw 96,473 new cases. The August 31-September 13 period saw a further large increase for Spain to 127,040 cases. For the period from September 14-27, Spain’s numbers further increased to 150,155.

The United Kingdom is facing major challenges as the last two weeks saw new cases more than double to 161,567 from 64,103 new cases in September 14-27 and just 32,422 new cases in the August 31-September 13 period.

The Netherlands more than doubled its number of new cases during September 28-Ocotber 11 to 59,561 from 27,584 new cases during September 14-27 and just 11,374 during August 31-September 13.

Germany showed a significant increase in the most recent two weeks to 38,724 from 24,712 the prior two weeks and 17,657 new cases in the period from the end of August to mid September.

Czechia which spiked following summer vacations saw its number of new cases during September 28-October 11 grow to 46,080 from 23,893 the prior two weeks and from 11,307 in the August 31 – September 13 period.

Italy jumped to 41,390 new cases during September 28-October up from 21,807 during September 14-27.

Belgium added 40,791 in the September 28-October 11 period more than doubling the numbers from September 14-27 of 17,797.

Romania added 31,168 in the last two weeks up from 18,849 the prior two week.

The Russian Federation had a large spike in the last two week up to 141,513 from 86,209 in the September 14-27 period.

Ukraine saw 60,762 new cases in September 28-October 11, up from 43,645 new cases the prior two weeks.

Canada has seen a second wave in the last four weeks, with new cases in August 31-September 13 time period being 8,468, followed by 15,530 during September 14-27 and 26,466 during September 28-October 11.

Israel’s second wave which reached 73,883 new cases during September 14-27, saw a decline to 62,903 new cases in the September 28-October 11 period.

Deaths/100,000 population

The United States has the largest number of deaths of any country to date (214,377) and had the second largest number of deaths in the last two weeks (9,880) behind only India (13,381). Both the U.S. and India saw the number of new deaths decline from the prior two weeks. The countries with the highest number of deaths per 100,000 population for the last two weeks were the following: Argentina (17.95), Israel (5.87), Mexico (5.80), Ecuador (5.27), Costa Rica (4.91), Colombia (4.70), Moldova (4.43), Brazil (4.17), Bolivia (4.03), Panama (3.74), Spain (3.62), Chile (3.59), Iran (3.50), Romania (3.46), Peru (3.33), and the United States (3.00). All other countries (including all other developed countries) had lower rates of death per 100,000 population. For all countries, the death rate over the last two weeks was 1.03 deaths/100,000 population. So the U.S.’s death rate over the last two weeks was 2.91 times the global average and was much higher than many large and/or developed countries. China’s number was so low, it was 0.00 people/100,000 population; France was 1.47, Germany 0.19, India 1.01, Italy 0.53, Japan 0.06, South Korea 0.06, Singapore 0.00, United Kingdom 1.18, Taiwan 0.00, Canada 0.86, Australia 0.11, New Zealand 0.00.

If looking at the entire period since the end of December 2019 through October 11, the average number of deaths for all countries per 100,000 of population has been 14.14 deaths. The nine countries (of 86 which account for over 98% of total deaths) with the highest death rates/100,000 for the full period are: Peru (102.19), Belgium (88.82), Bolivia (72.02), Brazil (71.17), Spain (70.16), Ecuador (70.15), Chile (70.03), Mexico (65.56), the United States (65.15). With the exception of Bolivia, Brazil, Chile, Ecuador, Mexico Peru and the United States, each of the other top countries overall has shown a drastic reduction since their peaks in April and as reflected in the experience in the last two weeks (the European countries were typically less than 1 death per 100,000). The United States death rate has been 4.61 times the global rate and many times higher than nearly all other developed countries and most developing countries. Consider the following examples: China, where the virus was first found, has a death per 100,000 population of just 0.33 people. India’s data show 7.93 per 100,000 population; Germany has 11.58; Japan has 1.28; Korea is just 0.84; Canada is 25.62; Switzerland is 20.98; Poland is 7.83; Ukraine is 11.11; Norway is 5.16; Australia is 3.56; New Zealand is 0.52.

Conclusion

The world in the first nine and a half months of 2020 has struggled to get the COVID-19 pandemic under control. While many countries in Europe and some in Asia and the major countries in Oceania had greatly reduced the number of new cases over time, there has been a significant resurgence in many of these countries (particularly in Europe) as their economies reopen, travel restrictions are eased, schools reopen in many countries and fall comes to the northern hemisphere. But the number of new cases continues to rage in much of the Americas (and there is a new surge in Canada and the start of resurgence in the U.S.), in parts of Asia (in particular India) and in limited parts of Africa. A recent WTO Secretariat information paper showed that there has been a reduction in shortages of many medical goods needed to handle the COVID-19 pandemic which is obviously good news, although as the global total of new cases continues to rise, there may yet be additional challenges in terms of supply. See 18 September 2020, Information Note, How WTO Members Have Used Trade Measures to Expedite Access to COVID-19 Critical Medical Goods and Services, https://www.wto.org/english/tratop_e/covid19_e/services_report_16092020_e.pdf.

In the northern hemisphere, countries are going into fall where there will likely be greater time spent indoors which could result in a significant spike in cases which could further stretch the global ability to respond.

Moreover, in many countries, stimulus packages have run their course such that large scale increases in unemployment could happen in the coming weeks. This has been the case in the United States even though the President and many of those closest to him have tested positive for COVID-19. Efforts at a new stimulus package have stalled despite a House which passed a package back in May and a second package in recent weeks. It remains unclear if anything will happen before the national elections on November 3. The result has been tens of thousands of employees furloughed in the airline industry, at major employers like Disney and will likely be the case for many state and local government employees with the start of the fiscal year in October and the obligation for most states to run a balanced budget. The failure of a new stimulus initiative will significantly increase the braking action on the economy from the pandemic in the fourth quarter of 2020 in the United States.

Similarly as countries in much of the developed world take new restrictive actions to address the second wave of cases, there will likely be significant ongoing effects to the global economy and international trade.

The last four weeks (beginning on September 14 through October 11) have seen the global number of new cases continue to grow after six weeks in July and most of August of what appeared to be a peak or plateau. For the reasons reviewed above, October – December are likely to see continued growth in the global number of new cases.

The progress on developing safe and effective vaccines is encouraging and has been sped by the willingness of major economies like the U.S. and the EU to fund manufacturing ahead of actual approval of the promising vaccines. Still the timing of outcomes remains unknown though anticipated by the end of 2020 and first part of 2021. China has been distributing one of its vaccines to parts of its population in advance of formal clearance of stage three trials. The Russians have been lining up customers for their vaccine even though the stage three trials are only underway and the results will lag the initial rollout of the vaccine. For other countries (the U.S., European Union, Japan, etc.) the rollout of vaccines if approved will take time to get large parts of the global population vaccinated. It is unclear what the global capacity will be to produce vaccines proven to be safe and effective, although reports suggest a likely significant shortfall despite government assistance in the global supplies that will be available in 2021. This uncertainty about likely capacities, plus the large purchases made by major western governments (U.S., EU, U.K., Japan), will likely place a large cloud over much if not all of 2021 in terms of distribution of vaccines even in an optimistic scenario.

With the world collectively unable to get the pandemic under control in many parts of the world, with likely increases this fall and winter, with fatigue in many countries on the actions needed to slow the spread of the virus and, in at least some countries, the mixed messages from government on the correct actions needed to gain control, the rest of 2020 will be very challenging. With the global death count now over one million, there have already been tens of thousand and likely hundreds of thousands of deaths that didn’t need to occur. The prospect of tens of thousands or even hundreds of thousands more dying needlessly hang over the global community as an inexplicable failure of at least some governments to protect their citizens and to cooperate for a comprehensive global response.

October 8th Video discussion on WTO Director-General selection process following the announcement of two finalists

On October 8, the Washington International Trade Association (WITA) put together a short video discussion among Rufus Yerxa (current President of the National Foreign Trade Council, former Deputy Director-General of the WTO among other positions), Wendy Cutler (currently Vice President and Managing Director of the Washington, D.C. office of the Asia Society Policy Institute and former senior negotiator at the U.S. Trade Representative’s Office) and me, moderated by Ken Levinson (Executive Director of WITA). The discussion dealt with the ongoing WTO Director-General selection process, what the results of the second round of consultations with Members suggest is important for the WTO Members in the next Director-General. The You Tube link to the discussion is below.

Informal Heads of Delegation Meeting at WTO confirms Nigerian and Korean candidates advance to third (final) round of consultations in selection of next Director-General

This morning’s 11 a.m. informal heads of delegation meeting in Geneva saw Ambassadors David Walker (New Zealand), Dacio Castillo (Honduras) and Harald Aspelund (Iceland) communicate the results of the second round of consultations with WTO Members to the membership. Pursuant to the procedures adopted in 2002 for the selection of the Director-General, the Chair of the General Council together with the Chairs of the Dispute Settlement Body and Trade Policy Review Body (the “troika”) consult with each Member of the WTO to receive their preferences in successive rounds of consultations. In the second round, each Member was asked to provide two of five remaining candidates as the Member’s preferences.

As leaked yesterday, the two candidates who advance to the third round of consultations are Dr. Ngozi Okonjo-Iweala of Nigeria and Minister Yoo Myung-hee of the Republic of Korea. The selection of these two candidates was based “on the depth and breadth of preferences articulated” by Members to the troika. “The result creates an historic precedent for the WTO in that it assures that the 7th Director-General will become the first woman to lead the organization.”

The WTO press release from today (October 8) from which all quotes are taken, “WTO members narrow field of DG candidates,” can be found here, https://www.wto.org/english/news_e/news20_e/dgsel_08oct20_e.htm.

“During the DG selection processes of 2005 and 2013, breadth of support was defined as ‘the distribution of preferences across geographic regions and among the categories of members generally recognized in WTO provisions: that is (least developed countries), developing countries and developed countries.’ The Chair said he and his colleagues were guided by the practices established in these General Council proceedings and he further explained that the decisions made clear that ‘breadth of support means the larger membership’.”

The three candidates not advancing are Amb. Amina C. Mohamed of Kenya, Mr. Mohammed Moziad Al-Tuwaijri of Saudi Arabia and Dr. Liam Fox of the United Kingdom. Amb. Walker (Chair of the General Council) said “On behalf of the entire membership, I would like to express deep gratitude for their participation in this selection process. It was clear that members consider them individuals of outstanding qualifications. I am sure you will all agree with us that in participating in the selection process, the candidates have all made a significant contribution to the standing and image of the WTO.”

The third round of consultations will start October 19 and end on October 27. There will be another informal heads of delegation meeting so that Amb. Walker and his facilitators can present the results of the third round of consultations, probably on Thursday, October 29.

The Chair of the General Council will then call a General Council meeting before November 7 to present their recommendation of the candidate most likely to obtain consensus. If Members agree, that candidate becomes the next Director-General. If there is a lack of consensus, the 2002 procedures provide for the possibility of a vote.

As reviewed in my post yesterday, the two candidates who are advancing have significantly different backgrounds presenting Members with an interesting choice. See October 7, 2020, Nigerian and Korean candidates advance to final round of consultations to become next WTO Director-General, https://currentthoughtsontrade.com/2020/10/07/nigerian-and-korean-candidates-advance-to-final-round-of-consultations-to-become-next-wto-director-general/.

While politics obviously has a role in the selection process, both candidates bring high-level government experience and an ability to work with various levels of government officials from many countries. Minister Yoo touted the fact that Korea has gone through significant economic development during her lifetime and so she has seen the needs of her country at various stages of economic development which would help her understand the needs of all WTO Members. She has also engaged in negotiations with many of the major WTO Members, including the U.S. and China. Dr. Okonjo-Iweala is a development economist and has expressed an interest in various issues where working with other international organizations would be important to ensure participation by all WTO members in WTO issues (e.g., addressing the digital divide which prevents many developing and least developed countries from engaging on e-commerce; ensuring access by all Members to vaccines and therapeutics to address the COVID-19 pandemic).

While the process of selecting a new Director-General is cumbersome, it was developed after the challenges in 1999 when no consensus was reached on a single candidate to give a greater likelihood of Members reaching a consensus on candidates put forward. The procedures worked in 2005 and in 2013 and appear to be working this year.

Nigerian and Korean Candidates Advance to Final Round of Consultations to Become Next WTO Director-General

The informal Heads of Delegation meeting at which Amb. David Walker (new Zealand),who is the Chairman of the General Council and his facilitators (Chairs of the Dispute Settlement Body and of the Trade Policy Review Body), will announce to the WTO membership which two of the five remaining candidates have advanced to the final round of consultations in the search for a new Director-General is scheduled for 11 a.m. Thursday morning (October 8). However, just as after the first round of consultations, the results have been leaked to the press by one or more Members.

Based on news stories this afternoon, Dr. Ngozi Okonjo-Iweala of Nigeria and Minister Yoo Myung-hee of the Republic of Korea are the two candidates who will advance to the third and final round of consultations. Minister Amina C. Mohamed of Kenya, Minister Mohammad Moziad Al-Tuwaijri of Saudi Arabia and the Rt Hon Dr. Liam Fox MP of the United Kingdom will not advance and are expected to withdraw.

As reviewed in prior posts, Minister Yoo has had active support in her candidacy from the Korean administration and had achieved success in being one of two preferences put forward by a united European Union earlier this week. Minister Yoo’s career has been in trade throughout and she is the first woman Minister for Trade in Korea. Dr. Okonjo-Iweala has been finance minister of Nigeria twice, served 25 years at the World Bank rising to the number two position and has had an important position with GAVI in recent years.

There has been much discussion of whether this selection of a Director-General would result in a woman being selected — which appears to now be a certainty — and which would be a first for the WTO. Similarly, African Members have been arguing that the position should go to an African candidate since Africa has never had a Director-General from the continent. Asia has had one Director-General in the WTO previously, but never a Korean. Minister Yoo is the third Korean trade minister to run for the Director-General post in the WTO’s short history.

It is unclear if WTO Members from Africa put forward their preferences in a uniform manner to support both African candidates who were part of the round two consultations. Some press articles have suggested that other candidates received at least some support from individual African Members. It is known that Dr. Okonjo-Iweala and Minister Mohamed had support from different groups of African countries — ECOWAS and EAC respectively.

The third round of consultations will have WTO Members looking at very different candidates in terms of backgrounds and perceived strengths. Minister Yoo’s background is entirely in trade and she is from an important trading nation and has negotiating history with many of the major WTO Members. Dr. Okonjo-Iweala is highly regarded, has limited trade experience (as Minister of Finance she had responsibility for Nigeria’s customs service), has deep experience in development economics and with efforts to respond to the needs of developing and least developed countries in terms of access to medical goods, including vaccines and therapeutics. While Nigeria is a large country, it is a significantly smaller trading nation than Korea. Korea is the 7th largest exporter of goods in 2019 ($542 billion) and 9th largest importer while Nigeria was 48th largest exporter ($62 billion) and was not in the top 50 importers.

Both remaining candidates are very talented and would make an interesting choice for the next Director-General. Block voting by the EU certainly was a help to Minister Yoo in her quest to advance to the third round. It will be interesting to see if the EU, the African Members or other groups vote in blocks in the third round.

The three candidates who will not move to the third round were also all very talented individuals who would have brought different skills and perspectives to the job if they had ultimately been selected.

We will learn tomorrow the timing of the third round of consultations.

Selection of WTO Director-General — Second Round of Consultations Ends Today, October 6

October 6 marks the last day of the second round of consultations by the Chairman of the General Counsel and his facilitators (Chairs of the Dispute Settlement Body and Trade Policy Review Body) with the WTO Members. Each WTO Member has been providing the troika of Chairs with the names of two of the five remaining candidates that constitute the Member’s preference in the second round. While the date of the Heads of Delegation meeting has not yet been announced, it will likely be Thursday morning. At that time, the two candidates advancing to the final third round of consultations will be identified.

In a prior post, I had noted press articles that indicated EU members were looking to back the candidacies of the Nigerian and Korean candidates — Dr. Ngozi Okonjo-Iweala and Minister Yoo Myung-hee. An article from Bloomberg yesterday confirmed that at yesterday’s meeting in Brussels, EU countries had agreed to back the two candidates. See Blomberg, October 5, 2020, EU Throws Its Weight Behind Nigerian, Korean WTO-Head Contenders, https://eur04.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.bloomberg.com%2Fnews%2Farticles%2F2020-10-05%2Feu-throws-its-weight-behind-nigerian-korean-wto-head-contenders&data=02%7C01%7C%7Cc25bd1089e95463bd6e108d8699846db%7C84df9e7fe9f640afb435aaaaaaaaaaaa%7C1%7C0%7C637375450027528387&sdata=Lbn5YOaH6ZIm9m4b1ES91psH6rUAMz2PyfO7GomVre8%3D&reserved=0.

Hungary, which had earlier indicated it would back Minister Amina C. Mohamed of Kenya and Dr. Liam Fox of the United Kingdom, reportedly agreed to join with the other EU members. Thus, the EU is understood to have expressed preferences as a block for the Nigerian and Korean candidates.

While Africa has two candidates among the five in the second round, African nations are split on support. The six members of the East Africa Community support Kenya’s Minister Amina Mohamed while countries in west Africa (Economic Community of West African States (ECOWAS)) support Nigeria’s Dr. Ngozi Okonjo-Iweala.

It is unclear if African Members of the WTO will list their two preferences as Okonjo-Iweala and Mohamed or will split their preferences by including one of the three other candidates along with one of the African candidates. With the EU 27 supporting the Korean candidate, lack of solidarity in Africa for its two candidates would increase the challenges for Minister Mohamed to be one of the two finalists making the third round of consultations.

There are, of course, large numbers of WTO Mrmbers in the Americas and in Asia and the Pacific, and there are European countries besides the EU’s 27. It has been assumed that each of the five remaining candidates would garner some support in each of these other areas. Block voting can deny some candidates geographical coverage in some parts of the world which can be a factor the troika consider in reducing the field from five to two.

it is nail biting time for the candidates.

An environmental read on the five candidates for the WTO Director-General slot

A British-based press publication on climate change released a story today looking at the position on climate change of the five candidates being considered in the second round of consultations at the WTO to become the next WTO Director-General. The publication, Climate House News says this about themselves, “Climate Home News is an independent news site specialising in the international politics of the climate crisis. Our London-based editorial team coordinates deep reporting from around the world on the political, economic, social and natural impacts of climate change. Our coverage of UN climate talks is essential reading.”

Today’s article can be found here: Climate Home News, 29 September 2020, African green reformer tipped to win UN trade leadership race, https://www.climatechangenews.com/2020/09/29/african-green-reformer-tipped-win-un-trade-leadership-race/.

While crediting H.E. Yoo Myung-hee of the Republic of Korea and the Rt Hon Dr. Liam Fox MP of the United Kingdom for speaking out on the need for fisheries subsidies reform, the article singles out H.E. Amina C. Mohamed of Kenya and Dr. Ngozi Okonjo-Iweala of Nigeria as the two candidates who appear committed to raise the profile of climate change within the WTO if selected as the Director-General. The fifth candidate, H.E. Mohammad Moziad Al-Tuwaijri of Saudi Arabia, was noted as having made no statements on climate change.

“Both women used their written candidate statements to call for environmental reform of the WTO’s trade rules, while their three opponents from Korea, the UK and Saudi Arabia, have said little about climate change.”

“Mohamed, who has held cabinet roles including foreign affairs in the Kenyan government since 2013, said the economic recovery must ‘take account’ of issues like climate change. The WTO should be reformed to ‘support our shared environmental objectives’ and encourage diffusion of clean technologies, she said.”

“Okonjo-Iweala, former finance minister for Nigeria, said that ‘the WTO appears paralysed at a time when its rule book would greatly benefit from an update to 21st century issues such as ecommerce and the digital economy, the green and circular economies’. She said she wants to reach ‘optimal complementarity between trade and the environment’.”

The article spends a fair amount of space on carbon pricing as an important initiative and notes Minister Mohamed’s comments that “the WTO could replicate carbon pricing initiatives like the EU’s ‘on a grander scale.”

Whether increasing the role of the WTO in addressing climate change is an issue of concern to many WTO Members, it certainly is to some and should be to many. Because trade and the environment is not a prominent area of ongoing WTO negotiations (other than fisheries subsidies), it is not surprising that all of the candidates seeking the Director-General position have not spoken extensively on the issue. Thus, one cannot necessarily draw the conclusions that the article suggests about three of the candidates. Being a member-driven organization, a candidate to become the next Director-General can not be faulted for focusing on the issues of stated concern by Members. Under the current WTO structure, it is not clear what influence a Director-General can have on subjects that Members will focus on.

Nonetheless, ensuring sustainable development (including how trade can help achieve global needs to address climate change) is important to businesses, workers, consumers, NGOs, and the global population. It can and should be a factor that Members of the WTO consider in who gets selected as the next Director-General — i.e., commitment to sustainable development and passion for making trade a positive contributor to solving climate change. More importantly, it must be a factor that Members consider in deciding on areas of negotiation and reform of the WTO in the months ahead.

In last two weeks global COVID-19 cases increased by more than 4.1 million as virus continues to spin out of control

After plateauing in terms of new cases during August, COVID-19 new cases are increasing rapidly for the world as a whole. For the period September 14-27, data compiled by the European Centre for Disease Prevention and Control show new cases in the world topping four million for the first time — 4,110,081. That compares to 3,780,469 new cases in the August 31-September 13 period and 3,558,360 for August 17-30, 3,624,548 for August 3-16 and 3,568,162 for the July 20-August 2 period. Total cases since the end of December 2019 are now above 32.9 million.

The United States which has more confirmed cases (7,078,798) than any other nation and more confirmed deaths from COVID-19 (204,497), saw the number of new cases increase over the last two weeks after three two week periods where the U.S. saw a decline in new cases. The U.S. recorded the extraordinary number of 908,980 new cases during the fourteen day period July 20-August 2. That number declined to 740,721 during August 3-16 and further declined to 600,417 new cases in the August 17-30 period and was further reduced to 524,526 new cases in the August 31-September 13 period. The downtrend was reversed these past two week, when the number of new cases increased to 592,690 or a daily average of 42,335 cases. The United States had the second largest number of new cases, following only India whose number of new cases is continuing to increase, and were 1,238,176 in the last two weeks, slightly higher than the 1,211,623 new cases reported in the August 31-September 13 period. India is the only country to have recorded more than one million cases in a two week period and appears to have plateaued at a rate of more than 88,000/day over the last month.

Brazil maintains its hold on third place though its new cases are falling since July 20-August 2 (633,017 new cases) to 609,219 new cases during August 3-16, 529,057 new cases during August 17-30, 469,534 new cases during August 31-September 13 and down to 402,304 new cases during September 14-27.

India, the United States and Brazil accounted for 54.33% of the new global cases during the last two weeks (down from 58.34% in the prior two weeks) and account for 54.04% of all cases confirmed since late December 2019 (up from 54.01% through two weeks ago).

The United States with 4.3% of global population has accounted for 21.51% of total confirmed cases since December 2019 — five times the share of total cases our population would justify. With the increase in the most recent two week after six weeks of declines, the U.S. was 14.42% of the total (up from 13.87% of new cases during August 17-30) or 3.35 times the U.S. share of global population. The U.S. also accounts for 20.55% of total deaths or 4.78 times the U.S. share of total population.

Continued growth of cases in the developing world

With the number of new cases in the United States declining over most of the last two months, the trend of new cases being focused on the developing world has shifted with a resurgence in Europe following the summer vacation period with a renewal of at least some international travel. While India and Brazil had by far the largest number of new cases from developing countries, they were followed by Argentina (166,781), Colombia (97,074), Peru (77,301), Iraq (73,883), Mexico (62,458), Iraq (59,191), Indonesia (56,582), the Philippines (43,393), Iran (43,146), Turkey (23,331), Chile (23,313), Bangladesh (21,829), South Africa (21,284) and then dozens of other countries with smaller numbers of new cases. Of the listed developing countries, only India, Argentina, Iraq, Indonesia, Iran and Turkey saw increases from the August 31-September 13 period.

Developed country resurgence in new cases

With the reopening of some international travel and with the end of the summer holiday season, there has been a noticeable surge of new cases in a number of developed countries, particularly in Western Europe where is it generally described as the coming of a second wave of COVID-19 cases. France overtook Spain for the most new cases during September 14-27 with a total of 153,535. France nearly doubled the large number it had experienced in the August 17-30 period (57,009 new cases) in the August 31-September 13 period with new cases reaching 101,381. Spain continues to show large increases for a developed country that had gotten the COVID-19 spread under control until recently. For August 17-30, Spain saw an additional 96,473 new cases. The August 31-September 13 period saw a further large increase for Spain to 127,040 cases. For the period from September 14-27, Spain’s numbers further increased to 150,155. The United Kingdom nearly doubled the number of new cases to 64,103 up from 32,422 new cases in the August 31-September 13 period. The Netherlands more than doubled its number of new cases during September 14-27 from the prior two week period going to 27,584 new cases from 11,374. Germany showed a significant increase in the most recent two weeks to 24,712 from the prior two weeks (17,657 new cases; two weeks before that 17,538 new cases). Czechia which spiked following summer vacations saw its number of new cases grow to 23,893 from 11,307 in the August 31 – September period; Italy added 21,807 (up from 19,444 the prior two weeks); Romania added 18,849 (up from 16,553 in the prior two weeks). Other countries in Europe (Russia (86,209 new cases), Ukraine (43,645 new cases) and Hungary (12,189 new cases)) as well as Israel (73,883 new cases) also saw significant additional new cases.

Deaths/100,000 population

The United States has the largest number of deaths of any country to date (204,497) and had the second largest number of deaths in the last two weeks (10,796) behind only India (15,917), though the U.S. number of new deaths declined slightly from the prior two weeks while India’s number of new deaths continued to climb. The countries with the highest number of deaths per 100,000 population for the last two weeks were the following: Argentina (9.68), Colombia (5.09), Brazil (4.83), Peru (4.76), Costa Rica (4.72), Bolivia (4.61), Mexico (4.42), Panama (3.96), Chile (3.67), Puerto Rico (3.65), Israel (3.97) and the United States (3.28). All other countries (including all other developed countries) had lower rates of death per 100,000 population. For all countries, the death rate over the last two weeks was 0.98 deaths/100,000 population. So the U.S.’s death rate over the last two weeks was 3.35 times the global average and was much higher than many large and/or developed countries. China’s number was so low, it was 0.00 people/100,000 population; France was 1.18, Germany 0.13, India 1.16, Italy 0.36, Japan 0.08, South Korea 0.08, Singapore 0.00, United Kingdom 0.52, Spain 3.16, Taiwan 0.00, Canada 0.25, Australia 0.27, New Zealand 0.02.

If looking at the entire period since the end of December 2019 through September 13, the average number of deaths for all countries per 100,000 of population has been 13.10 deaths. The nine countries (of 86 which account for over 98% of total deaths) with the highest death rates/100,000 for the full period are: Peru (98.87), Belgium (87.07), Bolivia (67.79), Spain (66.54), Chile (66.44), Ecuador (64.89), United Kingdom (62.97), Brazil (67.00), the United States (62.14). With the exception of Bolivia, Brazil, Chile, Ecuador, Peru and the United States, each of the other top countries overall has shown a drastic reduction since their peaks in April and as reflected in the experience in the last two weeks (the European countries were typically less than 1 death per 100,000). The United States death rate has been 4.74 times the global rate and many times higher many other developed countries and most developing countries. Consider the following examples: China, where the virus was first found, has a death per 100,000 population of just 0.33 people. India’s data show 6.92; Germany has 11.39; Japan has 1.22; Korea is just 0.78; Canada is 24.76; Switzerland is 20.81; Poland is 6.38; Ukraine is 8.87; Norway is 5.07; Australia is 3.45; New Zealand is 0.52.

Conclusion

The world in the first nine months of 2020 has struggled to get the COVID-19 pandemic under control. While many countries in Europe and some in Asia and the major countries in Oceania have greatly reduced the number of new cases over time, there has been a significant resurgence in many of these countries (particularly in Europe) as their economies reopen, travel restrictions are eased and as schools reopen in many countries. But the number of new cases continues to rage in much of the Americas (other than Canada), in parts of Asia (in particular India) and in limited parts of Africa. A recent WTO Secretariat information paper showed that there has been a reduction in shortages of many medical goods needed to handle the COVID-19 pandemic which is obviously good news, although as the global total of new cases continues to rise, there may yet be additional challenges in terms of supply. See 18 September 2020, Information Note, How WTO Members Have Used Trade Measures to Expedite Access to COVID-19 Critical Medical Goods and Services, https://www.wto.org/english/tratop_e/covid19_e/services_report_16092020_e.pdf.

In the northern hemisphere, countries are going into fall where there will likely be greater time spent indoors which could result in a significant spike in cases which could further stretch the global ability to respond.

Moreover, in many countries, stimulus packages have run their course such that large scale increases in unemployment could happen in the coming weeks. This is obviously the case in the United States in the airline industry (but also elsewhere) and will likely be the case for many state and local government employees with the start of the fiscal year in October and the obligation for most states to run a balanced budget. See, e.g., Bloomberg Businessweek, September 23, 2020, Airlines Face Desolate Future as Attempts to Reopen Crumble, https://www.bloomberg.com/news/articles/2020-09-23/coronavirus-pandemic-airlines-face-empty-future-as-crisis-continues?utm_campaign=news&utm_medium=bd&utm_source=applenews. The failure of a new stimulus initiative will significantly increase the braking action on the economy from the pandemic in the fourth quarter of 2020.

The September 14-27 period has seen the global number of new cases continue to grow after six weeks in July and most of August of what appeared to be a peak or plateau. October – December are likely to see continued growth in the global number of new cases.

The progress on developing safe and effective vaccines is encouraging and has been sped by the willingness of major economies like the U.S. and the EU to fund manufacturing ahead of actual approval of the promising vaccines. Still the results of the phase three trials are not yet in and as a temporary delay by AstraZeneca with its phase three trial showed, the timing of outcomes remains unknown though anticipated by the end of 2020 and first part of 2021. China has been distributing one of its vaccines to parts of its population in advance of formal clearance of stage three trials. The Russians have been lining up customers for their vaccine even though the stage three trials are only underway and the results will lag the initial rollout of the vaccine. For other countries (the U.S., European Union, Japan, etc.) the rollout of vaccines if approved will take time to get large parts of the global population vaccinated. It is unclear what the global capacity will be to produce vaccines proven to be safe and effective, although reports suggest a likely significant shortfall despite government assistance in the global supplies that will be available in 2021. This uncertainty about likely capacities, plus the large purchases made by major western governments (U.S., EU, U.K., Japan), will likely place a large cloud over much if not all of 2021 in terms of distribution of vaccines even in an optimistic scenario.

The ride is likely to get more complicated going forward with the world collectively unable to get the pandemic under control in many parts of the world, with likely increases this fall and winter, with fatigue in many countries on the actions needed to slow the spread of the virus and, in at least some countries, the mixed messages from government on the correct actions needed to gain control. With the global death count nearing one million, there have already been tens of thousand and likely hundreds of thousands of deaths that didn’t need to occur. The prospect of tens of thousands or even hundreds of thousands more dying needlessly hang over the global community. 2020 has proven to be a very challenging year. Time will tell if the challenge is confined to this year or continues to inflict substantial costs in 2021 and beyond.

Korean Trade Minister Travels to Europe to push her WTO candidacy; Moldovan candidate endorses Kenyan candidate

In a prior post, I had reviewed that the EU had backed all three women candidates in the first round of consultations at the WTO on who should be the next Director-General — H.E. Yoo Myung-hee of Korea; H.E. Amina C. Mohamed of Kenya; Dr. Ngozi Okonjo-Iweala of Nigeria — but had not backed either of the two men who advanced. See September 24, 2020, WTO Director-General selection – block voting likely to ensure next Director-General is a female, https://currentthoughtsontrade.com/2020/09/24/wto-director-general-selection-block-voting-likely-to-ensure-next-director-general-is-a-female/. All three women moved onto the second round of consultations along with H.E. Mohammad Moziad Al-Tuwaijri of Saudi Arabia and The Rt Hon Dr. Liam Fox MP of the United Kingdom.

With the other two women candidates likely to secure most or all of the second round votes from African WTO Members, it is obviously important for Minister Yoo to continue to receive support from at least some portion of European Members as well as geographical support from Asia and the Pacific and the Americas. With Africa and the Middle East having their own candidates, it is presumably her hope to also secure some support from those areas as well. While it is understood that the EU presented their preferences in the first round of consultations on a consolidated basis, that may not be the case in the second round where at least one EU member (Hungary) has indicated they will vote independent of the EU preferences. Thus, it is not surprising that Minister Yoo and the Korean government are putting focus this week on European Members of the WTO and other missions in Geneva As reviewed in the Korea Times, “‘Minister Yoo is visiting Geneva and Sweden from Sept. 27 until Oct. 2 to seek support of WTO member states with regard to the election of the next WTO director-general,’ the ministry said in a statement, Sept. 25.” The Korea Times, September 27, 2020, Trade minister Yoo Myung-hee kicks off Europe campaign for WTO race, https://www.koreatimes.co.kr/www/nation/2020/09/113_296737.html.

The other piece of news reported today relevant to the WTO Director-General campaign is the endorsement of the Kenyan candidate, H.E. Amina C. Mohamed, by one of the three candidates who did not advance at the end of the first round of consultations, Moldova’s Amb. Tudor Ulianovschi. The Standard, September 27, 2020, Moldovan Candidate Tudor Ulianovschi endorses Amina Mohamed for top WTO job, https://www.standardmedia.co.ke/branding-voice/article/2001387896/tudor-ulianovschi-endorses-amina-mohamed-for-top-wto-job. “He announced on twitter, ‘For the final round of @wto DG selection, two candidates will compete against each other to the benefit of the multilateral trade system. I am pleased to support my friend @AMB_A_Mohammed for the role of DG @wto. We have a similar experience (Ambassador&Minister), diplomacy, and character.'”

The second round of consultations with WTO Members to decide which two of the remaining five candidates will advance to the third round of consultations started on September 24 and will end on October 6. All five candidates and their governments are engaged in shoring up support for their candidacy, with the identification of the two remaining candidates likely to be announced on October 7 or 8.

The third round of consultations, when the candidate viewed as most likely to achieve consensus among the WTO Members, will get started later in October with a hoped for selection of the next Director-General completed by November 7.. Should there be a lack of consensus for the candidate emerging from the third round of consultations, the procedures for selecting Directors-General agreed to at the end of 2002 permits resort to voting if consensus cannot be achieved.

Additional Materials on Three of the Remaining Five Candidates for WTO Director-General post

While WTO Members are engaged in the second round of consultations with the Chairman of the General Council and his facilitators on which two of the remaining five candidates receive each Member’s preference, the candidates continue to reach out to Members and make media contacts. The second round of consultations started on September 24 and will continue until October 6 with a Heads of Delegation meeting likely held one or two days later to announce the two finalists and the timing of the third round of consultations.

The links below are for selected articles or news clips for three of the five remaining candidate and include news interviews.

The Bloomberg piece for Dr. Okonjo-Iweala in not directly WTO related though the WTO Director-General selection process is mentioned. The interview is a joint discussion with Australia’s former Prime Minister Julia Gillard looking at the opportunities for women in leadership in times of crisis.

In Bloomberg’s interview of Minister Yoo, Minister Yoo goes through a number of challenges facing the WTO and answers questions on U.S.-China tensions and responds to a question on whether Japan will oppose her nomination.

Dr. Fox’s interview with the Global Trade Review addresses his interest in the Director-General position, responds to a question about whether his candidacy is serious and answers a question on the relevance of Brexit. His interview with CNBC Africa was wide ranging and he stressed the need for a recommitment by Members to a common enterprise, the need to get the dispute settlement system functioning again. Dr. Fox talked about the needs for Micro-, Small and Medium businesses for all Members, and reviewed the actions he would take to improve the focus on these commercial operators. He also talked about the need for verification of information notified by parties, citing subsidy notifications. He discussed the need to obtain greater liberalization in trade in services and spent some time on e-commerce/digital trade and reviewed how online trade can be helpful to better integrating women into trade. He also talked about the regional trade agreement among African countries and the use of plurilaterals where multilaterals are not presently doable.

Dr. Ngozi Okonjo-Iweala (Nigeria):

Bloomberg, Australia’s Gillard, Nigeria’s Okonjo-Iweala on Women in Leadership, https://www.bloomberg.com/news/videos/2020-09-24/gillard-okonjo-iweala-on-women-in-leadership-video.

H.E. Yoo Myung-hee (Republic of Korea):

Bloomberg, Korean Minister Vows to Revitalize WTO if Elected as Chief, https://www.bloomberg.com/news/videos/2020-09-25/korean-minister-vows-to-revitalize-wto-if-elected-as-chief-video.

The Rt Hon Dr. Liam Fox MP (United Kingdom):

Global Trade Review, September 24, Exclusive interview: Liam Fox talks WTO bid, calls his backing of Brexit a ‘red herring’, https://www.gtreview.com/news/global/exclusive-interview-liam-fox-talks-wto-bid-calls-his-backing-for-brexit-a-red-herring/.

CNBC Africa, September 25, 2020, UK’s Liam Fox Shares His Vision for Global Trade, https://www.cnbcafrica.com/videos/2020/09/25/in-conversation-with-liam-fox-on-his-vision-for-global-trade/.

WTO Director-General selection — block voting likely to ensure next Director-General is a female

As the World Trade Organization starts the second round of consultations with Members today to continue to winnow down the list of candidates to move forward to the third round in mid-October, the likelihood of block preferences by countries within the EU and from Africa would seem to guarantee that the two candidates remaining at the end of the second round of consultations are two of the three women candidates — Dr. Ngozi Okonjo-Iweala of Nigeria, H.E. Yoo Myung-hee of the Republic of Korea and H.E. Amina C. Mohamed of Kenya.

First, African Members of the WTO have been arguing since before the start of the selection process that it was time for a Director-General to be from Africa. With two of the five remaining candidates being from Africa, if African Members provide as their preferences the two remaining African candidates, those two candidate will have a large support base before one looks at the rest of the world. There are currently some 45 WTO Members from Africa. While it is always possible for Members from Africa to support only one of the two African candidates and to pick a second preference from outside of the continent, it is likely that most Members will provide both African candidates as preferences to improve the chances of an African candidate in fact being selected as the next Director-General.

Second, press articles in recent days have indicated that the 27 European Union countries had given their preferences for the same candidates in round one of the consultations and that had led to three of the four candidates they supported advancing — the three women candidates from Nigeria, Kenya and the Republic of Korea. They had not expressed preferences for either of the two male candidates who advanced, H.E. Mohammad Moziad Al-Tuwaijri of Saudi Arabia and the Rt Hon Dr. Liam Fox MP of the United Kingdom. While WTO Members are obviously not limited to prefer in later rounds individuals they expressed preferences for in earlier rounds, it is expected that the EU countries (with limited exceptions) will agree on two of the three women candidates for Round 2. This would be consistent with their apparent desire to see a candidate from a different geographical area than recent DGs and for a candiate who is female supporting gender equality objectives of the UN Sustainable Development Goals. There is one known likely exception to the EU expressing preferences as a block approach. Specifically, the press has indicated that Hungary intends to identify its preferences as H.E. Mohamed of Kenya and Dr. Fox of the United Kingdom.

It is expected that each of the women candidates will have reasonable support in other parts of the world as well. With Dr. Seade out of the running, the Americas has no geographic candidate and will certainly provide a fair portion of their preferences to one or two of the women candidates. Similarly, Asia and the Pacific will split preferences among the five remaining candidates ensuring some additional support for each of the women.

While H.E. Al-Tuwaijri and Dr. Fox will certainly receive support in round two of the consultations from a significant number of Members, if the EU and Africa vote largely in blocks, it is hard to imagine how either of them advances to the final round of consultations.

Depending on the block preference approach of Africa and the EU, the two candidates who advance will either be the two African candidates or one of the African candidates and the Korean trade minister.

My assumption is that the third round will be a face off between H.E. Mohamed and Dr. Okonjo-Iweala. We will know in early October.

WTO Director-General selection process — what do results from first round of consultations suggest are key criteria for WTO Members in next Director-General?

Last week, five of eight candidates advanced to the second round of consultations when the WTO’s Chairman of the General Council reviewed with the membership the results of the first round of consultations. The second round of consultations starts this week. WTO Members’ preferences in the second round will result in the field being reduced from five to two candidates before the third round selects the candidate viewed as most likely to achieve consensus among the WTO Members. The selection process should end by November 7, 2020

Can anything be gleaned from the results of the first round results?

  1. The three candidates who did not advance

The three candidates eliminated were Dr. Jesus Seade Kuri of Mexico, Mr. Abdel-Hamid Mamdouh of Egypt and Amb. Tudor Ulianovschi of Moldova.

Dr. Seade has had personal involvement with the GATT during the Uruguay Round and was not only Mexico’s Ambassador to the GATT but then a Deputy Director-General of the GATT at the end of the Uruguay Round and one of the original Deputy Directors-General when the WTO was set up in 1995.

Mr. Mamdouh similarly has had a long and distinguished history with the GATT and WTO that stretches back to the Uruguay Round and continued in various capacities within the Secretariat ending with a sixteen year stint as Director of the Trade in Services and Investment Division.

Thus, if one was putting primacy on technical expertise or a deep understanding of the origins of the WTO (arguably relevant to current crisis issues like the impasse over the Appellate Body), then one would have expected both of these individuals to get past the round one consultations. As they didn’t, it follows that depth of technical capability was not a driving consideration for Members in the first round of consultations.

Although Dr. Seade has held various government positions including Under Secretary for North America and chief negotiator for the US-Mexico-Canada Agreement), he has never served as a Minister (Secretary) in the Mexican government. Moreover, Mexico, while part of North America, is typically referred to as part of Latin America. Since the last Director-General was from Brazil (also included in “Latin America”), this fact could have been viewed as a negative for Dr. Seade.

For the enormous history that Mr. Mamdouh has had with the WTO, he never served as either an Ambassador or took the position of Minister for the Egyptian government. Thus, to the extent Members were putting primacy on candidates who had served in a high political position for their host government, Mr. Mamdouh would have been viewed as not meeting that criteria.

Amb. Ulianovschi served both as Moldova’s Ambassador to Switzerland and Liechtenstein (including being Ambassador/Permanent Representative to the WTO) and later served as a Minister of Foreign Affairs. Thus, he has both familiarity with WTO issues and had a prior senior political position. Since Moldova is part of Europe and most Directors-General of the GATT and WTO have been from Europe, this could have been viewed as a negative for Amb. Ulianovschi (though the same was also true for Dr. Liam Fox of the United Kingdom who has advanced to the second round of consultations).

2. The five candidates who have advanced to round two

Of the five candidates who have advanced, all have served as a Minister in their home government with four — Dr. Ngozi Okonjo-Iweala of Nigeria, H.E. Amina C. Mohamed of Kenya, H.E. Mohammad Moziad Al-Tuwaijri of Saudi Arabia and the Rt Hon Dr. Liam Fox MP of the United Kingdom having served two terms or in two different Minister positions. The fifth, H.E. Yoo Myung-hee of the Republic of Korea is the current Minister for Trade in Korea.

The differentiation between those who advanced and those who didn’t thus seems to hinge in significant part of the perception of political weight a candidate would bring based in part on the senior government role each has played. While Amb. Ulianovschi of Moldova did not advance and yet was a Minister, his being from a European country may have been the distinguishing factor. He was also the youngest candidate by more than a decade which may have been another factor for some.

Moving into the second round of consultations, what considerations may influence who makes the next cut?

The Chairman of the General Council indicated that WTO Members viewed all eight candidates as highly qualified and respected. This means for many Members the important factors may be less about the qualifications but more about geographical diversity of the membership. The Procedures adopted at the end of 2002 for the selection of Directors-General has a paragraph dealing with the representativeness of candidates (WT/L/509 at para. 13):

“Where Members are faced in the final selection with equally meritorious
candidates, they 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.”

As there has not been a Director-General from Africa or from the Middle East and only one from Asia, geographical diversity could have aided four of the five candidates who advanced to the second round of consultations.

In addition, no GATT or WTO Director-General has been a woman to date. One of the UN Sustainable Development Goals (SDGs) is gender equality (SDG 5). Three of the candidates who have advanced are female. A fourth, Dr. Liam Fox, committed to ensuring that half of the senior WTO Secretariat would be women if he were selected as the next Director-General.

While all eight candidates indicated their preference for the selection to be of the best qualified candidate, it is certainly likely that other criteria will weigh in the second and third round consultation process which leads to the selection of a single candidate.

The three women candidates

Among the three women candidates, H.E. Mohamed has a proven track record on trade within the WTO and as Chair of the 2015 Nairobi Ministerial. H.E. Yoo’s career has been entirely in trade, and she has dealt with each of the U.S., China and the EU in her trade capacity for Korea. Dr. Okonjo-Iweala has never been Minister of Trade though her role (twice) as Minister of Finance for Nigeria included some trade-related areas (customs, trade facilitation) and she had a distinguished career at the World Bank and is now active in various organization relevant to the recovery from COVID-19 such as GAVI (focused on getting vaccines to countries in need).

Obviously two of the three women candidates have serious trade/WTO backgrounds. The third is often viewed as having the largest political profile. Depending on how large the preference is for a strong leader with significant political experience or a strong leader with significant understanding of the trade problems before the WTO, this could lead to Dr. Okonjo-Iweala and H.E. Mohamed as being the top two women candidates or H.E. Mohamed and H.E. Yoo filling that role.

Possible wild cards that could hurt one or two of the women candidates are (1) the ongoing Japan-South Korea conflict that H.E. Yoo has been involved in; (2) China’s view towards H.E. Yoo if concerned about whether China will maintain a Deputy-Director General slot going forward if an Asian candidate is selected as the next Director-General; (3) the late disclosure that Dr. Okonjo-Iweala is a dual Nigerian-U.S. citizen and whether that is problematic for China or other Members.

The two remaining male candidates

It is unlikely that Dr. Fox makes it to the third round based simply on the Paragraph 13 indication of importance of geographical diversity and the long history of European Directors-General. He would bring a unique viewpoint to the Director-General position being the only candidate who has repeatedly stood for election in his country. His commitment to ensure half of the senior WTO Secretariat are women may also be a plus for him if only one of the women candidates advances.

Similarly, unless the membership decides that what they want as a Director-General is someone who will move the organization to a more business-like functioning approach, it is unlikely that H.E. Al-Tuwaijri makes it past round two. He has the advantage of being from an area (Middle East) that has not had a Director-General. Moreover, he has worked closely with G20 countries which could be a plus if only one of the women candidates advances to round three.

Likely outcome of Round Two Consultations

The second round of consultations starts on September 24 and concludes on October 6. At the meeting of the Heads of Delegation that follows the close of the consultations (probably October 8), it is likely that H.E. Amina C. Mohamed and Dr. Ngozi Okonjo-Iweala advance to the third round of consultations.

Who will likely emerge as the sole remaining candidate after Round Three?

If H.E. Mohamed and Dr. Okonjo-Iweala advance beyond round two, the selection of a candidate most likely to achieve consensus among the WTO Members in round three will depend on whether Members prefer a candidate who has a record of achieving results in the WTO or prefer a candidate with a large record of in-country reform and of achievement within the World Bank and ability to focus Members on post COVID-19 recovery needs.

Either would be an interesting choice and would bring great energy to what will be a very challenging job at a time of multiple crises for the WTO and concerns about its continued relevance. Based on what seems to have mattered in Round One of the consultations, I would predict that Dr. Ngozi Okonjo-Iweala will be the next Director-General with the one caveat of whether her dual citizenship with the U.S. in addition to her home country of Nigeria becomes problematic in fact. If the caveat applies, then look for H.E. Amina C. Mohamed to be the next Director-General.

Race for becoming the next Director-General of the WTO — five candidates advance; three are asked to withdraw

At a Heads of Delegation meeting held at the World Trade Organization this morning (11:00 a.m. Geneva time), the Chairman of the General Council, Amb. David Walker, and his facilitators, Amb. Dacio Castillo of Honduras (Chairman of the Dispute Settlement Body) and Amb. Harald Aspelund of Iceland (Chairman of the Trade Policy Review Body) informed the WTO Members that their consultations with Members had identified the five candidates (of eight total) who had received the broadest and deepest support and hence would be moving on to round two of the consultation process.

The five candidates who move to the second round of consultations include (in order that they were put forward as a candidate by their government):

Dr. Ngozi Okonjo-Iweala of Nigeria;

H.E. Yoo Myung-hee of the Republic of Korea;

H.E. Amina C. Mohamed, of Kenya;

H.E. Mohammed Moziad Al-Tuwaijri of Saudi Arabia;

The Rt Hon Dr. Liam Fox MP of the United Kingdom.

The three candidates who have been asked to withdraw based on the results of the first round of consultations include:

Dr. Jesus Seade Kuri of Mexico;

Mr. Abdel-Hamid Mamdouh of Egypt;

Amb. Tudor Ulianovschi of Moldova.

The WTO press release can be found here, WTO members narrow field of DG candidates, https://www.wto.org/english/news_e/news20_e/hod_18sep20_e.htm

A field that had originally consisted of five men and three women with two being Europeans, three being Africans, one being from the Middle East, one being Asian, and one being North American (Latin) is now a field of three women and two men with one from Europe, two from Africa, one from the Middle East and one from Asia.

As the biographies posted on the WTO webpage and the candidates prepared statement to the General Council, subsequent press conference, and interviews, webinars and other press report make clear, the eight candidates were all highly qualified individuals with a good grasp of issues currently facing the WTO and the challenges of reform. This fact and that all eight candidates were respected by the Membership was confirmed by Amb. Walker at today’s Heads of Delegation meeting.

The elimination of the three candidates removes two with the longest engagement with the GATT/WTO — Dr. Jesus Seade and Mr. Abdel-Hamid Mamdouh and the youngest candidate, Amb. Tudor Ulianovschi.

Of the five remaining, only two have extensive WTO/trade experience — H.E. Amina C. Mohamed, H.E. Yoo Myung-hee, although Dr. Liam Fox served as the U.K. Secretary of State for trade for a period of time as well and H.E. Al-Tuwaijri has a broad portfolio with trade issues included. Dr. Ngozi Okonjo-Iweala has extensive experience as Nigeria’s Finance Minister (with customs responsibilities) and as a senior official at the World Bank.

Second Round of Consultations

During the Heads of Delegation meeting, Amb. Walker announced that the second round of consultations would start on September 24 and run until October 6 after which there will be another Heads of Delegation meeting to review which two candidates advance to the third and final round of consultations.

During the first round, each Member was asked to identify four candidates as preferences. During the second round, each Member will be asked to identify two candidates as preferences. The three Ambassadors who are conducting the consultations with Members will then announce the results further narrowing the field from the current five to just two candidates.

Third Round of Consultations

The timing of the third round of consultations will be announced at the next Heads of Delegation meeting when the second round is completed. It is anticipated that the third round and its results will be completed ahead of November 7 consistent with the procedures adopted by the General Council back in December 2002. Procedures for the Appointment of Directors-General, WT/L/509. The results of the third round of consultations will be the candidate that is viewed as most likely to achieve consensus from the Membership. If consensus is likely, a General Council meeting will be called to confirm the selection. If consensus is not achieved, the process forward is unclear but can include taking a vote instead of pursuing consensus.

Conclusion

The selection process to date is running smoothly. The WTO was fortunate that so many talented individuals were willing to step forward to seek to become the next Director-General of the WTO and go through the grueling process that has characterized the first three months. Congratulations to the five candidates who advance. Heartfelt thanks go out to the talented candidates whose run is now ended.

The procedures adopted in 2002 seem overly complicated and time consuming to many who look in from the outside. Complicated and time consuming the procedures certainly are. However, the procedures were adopted in an effort to have Members focus on the positive question – who is your preference — and avoid Members politically committing to who was unacceptable as had happened in 1999.

Let’s hope that the remainder of the selection process proceeds smoothly and without incident.

COVID-19 cases increase in last two weeks, setting new global record for new cases in fourteen day period.

In my last two posts of August 30 and August 16, I suggested that it appeared that the global spread of COVID-19 may have peaked or plateauted. See August 30, 2020, The global number of confirmed COVID-19 cases passes 25 million with more than 843,000 deaths – increased race to lock-up vaccine supplies, https://currentthoughtsontrade.com/2020/08/30/the-global-number-of-confirmed-covid-19-cases-passes-25-million-with-more-than-843000-deaths-increased-race-to-lock-up-vaccine-supplies/; August 16, 2020, Is the world at the peak of the COVID-19 pandemic?  Last two weeks suggest a peaking of the growth of global infections may be at hand, https://currentthoughtsontrade.com/2020/08/16/is-the-world-at-the-peak-of-the-covid-19-pandemic-last-two-weeks-suggest-a-peaking-of-the-growth-of-global-infections-may-be-at-hand/. However, data compiled by the European Centre for Disease Prevention and Control for the August 31-September 13 period shows a return to growth in new cases. The latest two weeks show total new cases of 3,780,469. This compares to the total new cases for the August 17-30 time period of 3,558,360, 3,624,548 for August 3-16 and 3,568,162 for the July 20-August 2 period. Total cases since the end of December 2019 are now just shy of 29 million.

The United States which has more confirmed cases (6,486,108) than any other nation and more confirmed deaths from COVID-19 (193,701), had a third two-week decline in new cases. The U.S. recorded the extraordinary number of 908,980 new cases during the fourteen day period July 20-August 2. That number declined to 740,721 during August 3-16 and further declined to 600,417 new cases in the August 17-30 period and was further reduced to 524,526 new cases in the August 31-September 13 period. The most recent period is still 28.21% higher than what had been the prior peak during April 13-26 of 409,102 new cases. Even with the significant reduction in new cases in the August 31-September 13 period, the United States had the second largest number of new cases, following only India whose number of new cases is continuing to rapidly increase, and were 1,211,623 in the last two weeks (the first country to have more than one million cases in a two week period). Brazil maintains its hold on third place though its new cases are also falling since July 20-August 2 (633,017 new cases) to 609,219 new cases during August 3-16, 529,057 new cases during August 17-30 and 469,534 new cases during August 31-September 13. India, the United States and Brazil accounted for an extraordinary 58.34% of the new global cases during the last two weeks and account for 54.01% of all cases confirmed since late December 2019. The United States with 4.3% of global population has accounted for 22.52% of total confirmed cases since December 2019. With the continued declining numbers in the last two weeks while the overall total of new cases grew, the U.S. was still 13.87% of new cases during August 17-30 or roughly three times the U.S. share of global population.

Continued growth of cases in the developing world

With the number of new cases in the United States declining, the trend to new cases being focused on the developing world continues although there has been some significant resurgence of new cases in a number of developed countries during the summer vacation period with a renewal of at least some international travel. While India and Brazil had by far the largest number of new cases from developing countries, they were followed by Argentina (143,681), Colombia (109,050), Peru (83,397), Mexico (72,261), Iraq (59,332), Indonesia (45,562), the Philippines (44,732), South Africa (25,663) and then dozens of other countries with smaller numbers of new cases.

Developed country resurgence in new cases

With the reopening of some international travel and with the end of the summer holiday season, there has been a noticeable surge of new cases in a number of developed countries, particularly in Western Europe. Spain showed the largest increase of a developed country that had gotten the COVID-19 spread under control until recently. For August 17-30, Spain saw an additional 96,473 new cases. The August 31-September 13 period saw a further large increase for Spain to 127,040 cases. France nearly doubled the large number it had experienced in the August 17-30 period (57,009 new cases) in the latest two weeks, with new cases reaching 101,381. Germany was up slightly from the prior two weeks (17,538 new cases) at 17,657 new cases. Italy added 19,444; Romania added 16,553; the United Kingdom added 32,422; the Netherlands increased by 11,374; Czechia increased by 11,307. Other countries in Europe (Russia and Ukraine) as well as Israel also saw significant additional new cases.

Deaths/100,000 population

The United States has the largest number of deaths of any country to date (193,701) and had the second largest number of deaths in the last two weeks (10,922) behind only India (15,088), though the U.S. number of new deaths declined from the prior two weeks while India’s number of new deaths continued to climb. The countries with the highest number of deaths per 100,000 population for the last two weeks were the following: Ecuador (24.91), Bolivia (20.49), Colombia (7.29), Argentina (6.48), Peru (6.11), Mexico (5.32), Brazil (5.09), Panama (4.05), Chile (3.77), Puerto Rico (3.65), Costa Rica (3.41) and the United States (3.32). All other countries (including all other developed countries) had lower rates of death per 100,000 population. For all countries, the death rate over the last two weeks was 1.02 deaths/100,000 population in the last two weeks.

If looking at the entire period since the end of December 2019 through September 13, the average number of deaths for all countries per 100,000 of population has been 12.13 deaths. The ten countries (of 71 which account for 98% of total deaths) with the highest death rates/100,000 for the full period are: Peru (94.10), Belgium (86.59), Bolivia (63.38), Spain (63.38), Chile (62.76), Ecuador (62.53), United Kingdom (62.45), Brazil (62.17), Italy (58.98), the United States (58.86). With the exception of Bolivia, Brazil, Chile, Ecuador, Peru and the United States, each of the other top countries overall has shown a drastic reduction since their peaks in April and as reflected in the experience in the last two weeks (the European countries were typically less than 1 death per 100,000).

Conclusion

The world in the first eight months of 2020 has struggled to get the COVID-19 pandemic under control. While many countries in Europe and some in Asia and the major countries in Oceania have greatly reduced the number of new cases over time, there has been some resurgence in many of these countries as their economies reopen, travel restrictions are eased and as schools reopen in many countries. But the number of new cases continues to rage in much of the Americas (other than Canada), in parts of Asia (in particular India) and in parts of Africa. Since most new cases are now in developing countries, it is unclear how many of these countries will be able to handle a significant number of cases, whether their healthcare infrastructure will be overwhelmed and whether they will have the medical goods needed to handle the cases safely.

The August 31-September 13 period has seen the global number of new cases growing after six weeks of what appeared to be a peak or plateau. That is not good news for the world as in many parts of the world schools are reopening and fall and winter will bring greater time indoors likely resulting in continued growth in new cases.

The progress on developing safe and effective vaccines is encouraging and has been sped by the willingness of major economies like the U.S. and the EU to fund manufacturing ahead of actual approval of the promising vaccines. Still the results of the phase three trials are not yet in and as a temporary delay by AstraZeneca with its phase three trial shows, the timing of outcomes remains unknown though anticipated by the end of 2020 and first part of 2021. Still the rollout of vaccines if approved will take time to get large parts of the global population vaccinated. This will likely place a large cloud over much if not all of 2021 even in an optimistic scenario.

Whether the world will rise to the challenges in terms of improving access to medical goods, to maintaining an open trading system, to aiding not only national populations but ensuring assistance to the most vulnerable, and when vaccines are approved to ensuring an equitable and affordable access by all are open questions. If the world is not able to collaborate on these issues, the 2020s will be a lost decade and will threaten global security.

Race for WTO Director-General — additional material on The Rt Hon Dr. Liam Fox MP (United Kingdom)

The two month period for candidates for the position of Director-General of the World Trade Organization to make themselves known to the WTO Members ends today, September 7, 2020. The Chairman of the General Council along with the Chairs of the Dispute Settlement Body and Trade Policy Review Body will now start the process of holding “confessionals” with WTO Members to receive in confidence the four candidates whom each Member believes could generate consensus among the membership as part of the first round of reducing the candidates from eight to five. Two other rounds will follow to reduce the candidates from five to two and then from two to one.

Today I review some other press articles about the candidate from the United Kingdom to provide additional perspective on important issues or the candidate’s approach to the position of Director-General if selected. The other seven candidates were reviewed previously. Yesterday, I posted material about H.E. Mohammad Moziad Al-Tuwaijri (Saudi Arabia), the day before on H.E. Amina C. Mohamed (Kenya), on September 4 on H.E. Yoo Myung-hee (Republic of Korea), on September 3 on Amb. Tudor Ulianovschi (Modolva), On September 2 on Mr. Abdel-Hamid Mamdouh (Egypt), on September 1 on Dr. Ngozi Okonjo-Iweala (Nigeria) and on August 31 on Dr. Jesus Seade Kuri. See September 6, 2020, Race for WTO Director-General – additional material on H.E. Mohammad Moziad Al-Tuwaijri (Saudi Arabia), https://currentthoughtsontrade.com/2020/09/06/race-for-wto-director-general-additional-material-on-h-e-mohammad-moziad-al-tuwaijri-saudi-arabia/; September 5, 2020, Race for WTO Director-General – additional material on H.E. Amina C. Mohamed (Kenya), https://currentthoughtsontrade.com/2020/09/05/race-for-wto-director-general-additional-material-on-h-e-amina-c-mohamed-kenya/; September 4, 2020:  Race for WTO Director-General – additional material on H.E. Yoo Myung-hee (Republic of Korea), https://currentthoughtsontrade.com/2020/09/04/race-for-wto-director-general-additional-material-on-h-e-yoo-myung-hee-republic-of-korea/; September 3, 2020,   Race for WTO Director-General – additional material on Amb. Tudor Ulianovschi (Moldova), https://currentthoughtsontrade.com/2020/09/03/race-for-wto-director-general-additional-material-on-amb-tudor-ulianovschi-moldova/; September 2, 2020, Race for WTO Director-General – additional material on Mr. Abdel-Hamid Mamdouh (Egypt), https://currentthoughtsontrade.com/2020/09/02/race-for-wto-director-general-additional-material-on-mr-abdel-hamid-mamdouh-egypt/; September 1, 2020, Race for WTO Director-General – additional material on Dr. Ngozi Okonjo-Iweala (Nigeria), https://currentthoughtsontrade.com/2020/09/01/race-for-wto-director-general-additional-material-on-dr-ngozi-okonjo-iweala-nigeria/; August 31, 2020, Race for WTO Director-General – additional material on Dr. Jesus Seade Kuri (Mexico), https://currentthoughtsontrade.com/2020/08/31/race-for-wto-director-general-additional-material-on-dr-jesus-seade-kuri-mexico/.

There is no intention on my part to be exhaustive, and the research has been limited to press pieces or videos in English. Rather the intention is to identify information not addressed in my earlier posts that may be of interest to readers.

As noted above, today’s post looks at a few articles featuring The Rt Hon Dr. Liam Fox MP from the United Kingdom, the eighth and final candidate nominated for the position of Director-General.

  1. The Asean Post, September 5, 2020, Pandemic Is ‘Kiss of Death’ For Managed Trade, https://theaseanpost.com/article/pandemic-kiss-death-managed-trade.

“The coronavirus pandemic has heaped pressure on the troubled World Trade Organization (WTO), a WTO leadership candidate said, warning the crisis could spell the end of rules-based international trade altogether.

“Liam Fox, Britain’s first post-Brexit international trade secretary and one of eight candidates vying to become the WTO’s next director-general (DG), voiced concern that countries might turn their backs on its multilateral trading model.

“‘The reaction of some countries to the COVID emergency will be to seek solace in protectionism and to believe that they will get more resilience by … closing themselves off, if you like, from the global economy,’ he said Thursday in an interview.

“‘Exactly the opposite I believe is true,’ he explained during a conversation using the video link Zoom, insisting that countries will find more security by opening up and ensuring diversity of supply.

“‘For the rules-based trading system, COVID could be the kiss of life if we embrace the right policies – or the kiss of death if we don’t.'”

2. Government of the United Kingdom, Department for International Trade, 19 August 2020, Liam Fox pledges half his team will be women if he is the WTO DG, https://www.gov.uk/government/news/liam-fox-pledges-half-his-team-will-be-women-if-he-is-the-wto-dg.

“Dr Liam Fox has pledged that women will make up at least half of his senior leadership team if he is appointed the next Director General of the World Trade Organization (WTO).

“The UK has nominated former International Trade Secretary Dr Fox to be a candidate to replace current Director General Roberto Azevedo who stepped down this month after seven years.

“Dr Fox, the only elected politician in the running for the role, believes changes need to be made to attract more women into senior trade roles at the WTO. He states:

  • “Women’s economic empowerment through trade can only continue with widespread commitment to advancing the WTO and rules-based trading systems
  • “There is a need for the WTO to embrace the ‘talents, innovation and creativity’ of women to ensure it can lift another one billion people out of poverty
  • “Thirty years of progress is under threat from rising levels of unilateral actions and protectionism and those bearing the economic impact will disproportionately be women

“Dr Fox believes securing the input of women at a senior level at the WTO will help reduce the many barriers women face in accessing trading opportunities.

He said:

“‘As someone who trained and practised as a medical doctor I was used to half, and sometimes more, of my colleagues being female. But, despite real progress being made, women continue to face disproportionate barriers in accessing trading opportunities and markets due to discriminatory attitudes, poor conditions and harassment as well as unequal access to inputs such as credit and land.’

“‘And, as we look around us at the rising levels of unilateral actions and protectionism, we know that the remarkable achievement of the last three decades is under threat and that those bearing the brunt will be women.’

“Dr Fox believes the WTO and rules-based trading systems have created opportunities for women in both developed and developing countries which will be key to helping the global economy recover from the effects of the coronavirus pandemic.

“In 2016, McKinsey estimated that creating more opportunities for women to work, including in export-led sectors, could add $12 trillion to the global economy by 2025.

“Dr Fox said:

“‘What could be more counterproductive than failing to utilize the talents, innovation and creativity of half the planet’s population? Women’s economic empowerment through trade can and has played a key role in creating political stability and so the conditions for wider economic progress. This matters to all of us, wherever we are.’

“Currently, neither the Director General nor any of the four Deputy Director Generals at the WTO are female. The latest diversity breakdown of the WTO secretariat shows that of the 24 staff members in the most senior grades, only five were female.

Dr Fox said:

“‘To attract more women into the architecture of trade, we need to make changes at all levels.’

“‘We need more input for women, by women if the WTO is to play its part in taking another one billion people out of extreme poverty. That is why, if I am successful in my candidacy, women will account for at least half of my senior leadership team.'”

3. Inside U.S. Trade’s World Trade Online, September 2, 2020, Fox: Congress should leverage TPA renewal to resolve WTO appellate impasse, https://insidetrade.com/trade/fox-congress-should-leverage-tpa-renewal-resolve-wto-appellate-impasse.

The article reviews statements by Dr. Fox that his political thinking would identify outreach to the U.S. Congress after the upcoming election as a way to make progress in resolving the impasse on the WTO’s Appellate Body. Dr. Fox opines that the renewal of trade promotion authority (“TPA”) in the front half of 2021 gives Congress significant say on trade matters which could be used to find solutions on the Appellate Body impasse.

4.  Chatham House, 10 August 2020, In Conversation with The Rt Hon Dr Liam Fox MP: Candidate for Director-General of the World Trade Organization, https://www.chathamhouse.org/event/conversation-rt-hon-dr-liam-fox-mp-candidate-director-general-world-trade-organization.

Chatham House has conducted interviews with each of the candidates for Director-General. The session with Dr. Fox was held on August 10, 2020 and was on the record. My notes of some of the questions asked and of Dr. Fox’s responses are contained below.

Q:  You are a free trader.  Could you share your philosophy about international trade?  What is your vision of trade?

A:  One of the great benefits of international trade is its contribution to moving one billion people out of poverty in a generation, one of the greatest accomplishment in history.  We live in a very interdependent and interconnected world.  Trade is not an end in itself but a means to spread prosperity around the world which leads to security.  If countries try to block trade, there are consequences such as mass migration of peoples.

Q:  How do you deal with the view that many people in developed world feel that trade has undermined their prosperity?

A:  Such views flow from a failure to understand the benefits that come from free and open trade.  In developed countries we take benefits of trade for granted and simply look at the downside costs.  If you consider benefits to consumers from trade, the benefits include a much broader selection of goods and services at lower prices.  Countries always have the trade off between trade liberalization and protectionism.  Those seeking protection may have better lobbyists, but they don’t have better products.  Typically trade ministers don’t mention consumers at all when discussing trade policies.  Yet that is one of the basic advantages of trade – greater choice, lower prices.

Q:  What are the top three challenges you would face if selected as the next Director-General?

A: Dr. Fox views there are different types of issues facing the WTO.  The most important issue in his view is to get Members to reconnect with the vision of a shared endeavor.  One of the dangers of undermining the multilateral system is the resulting free-for-all that would result among countries which will hurt most countries including major countries like the United Kingdom and Germany.  Secondly, there are a host of practical issues – restoring the appellate body would be one. Without the ability to enforce rights and obligations, the WTO is denying Members one of the value added elements of membership. Other practical issues include dealing with and recovery from the COVID crisis and how we treat our members.  At the time of the webinar with Chatham House, Dr. Fox had done 72 bilaterals with Members. There is a common view that small members who are a nuisance get listened to as do the large members. However, the rest of the 164 Members don’t feel that they do get listened to. This is a big problem for the WTO.  For the organization to function well, the Members need trust among themselves. For Member who don’t feel that their views are being listened to, the trust breaks down.

Q:  Members will be much more involved in their own economies post-COVID.  What can WTO do to get ahead of this situation?

A:  Governments will be much more concerned with domestic issues in the post-COVID world.  The focus on domestic needs will potentially lead to more protectionism, greater subsidies and other trade distorting measures. The key point for Members and the WTO is the resilience of the multilateral system.  What we have learned during the COVID pandemic is that the way we have organized global value chains has shifted from a structure of resilience to one of efficiency. The world will likely get some rebalancing of global value chains to improve resilience. The role of the WTO is to make the case openly and constructively that resilience is to be found in greater diversity of supply, not from massive onshoring or attempting to go it alone.  If a country onshores everything, the country potentially will be more vulnerable in another crisis.  During the COVID pandemic, one can see many elements of global trade that have been disrupted.  Vessels ended up in the far east disrupting timing of the movement of goods. With far fewer passenger flights, there has been less air cargo which has raised costs. The lock down in countries has led to less government work on various trade related ares (e.g., certifications).  Yet all of these problems we have seen during the pandemic are not technical in nature but rather political.  That is the reason Dr. Fox believes that the next Director-General of the WTO needs to have a political background.  Many issues will be sorted out in capitals based on political will and not in technical discussions in Geneva.

Q:  How would you engage the big players, like the U.S., China and the EU?

A:  Engaging the major players is about getting the political commitment from them to wok within the system.  What their voters want is a successful economy. In Dr. Fox’s view, a successful economy is enhanced by open trade.  In terms of the US-China dispute, typically disputes end when costs become too great for the disputants to sustain.  In a global environment like existed in 2018 and much of 2019 where growth was occurring, costs may have been sustainable by the U.S. and China.  Dr. Fox believes that the costs are less likely to be sustainable in the post-COVID world.  If true, one would expect there would be increased internal pressures to come to a compromise in the two countries.

Q:  UNCTAD has confirmed a major contraction of trade during the pandemic. What is most important for the WTO to do to facilitate dismantling trade barriers?

A:  The first task for the WTO and the next Director-General is to deal with the COVID export-restriction measures.  In Dr. Fox’s view, nothing is as permanent as temporary measures entered during a crisis.  The WTO needs to improve notifications (export restrictions or other barriers). Dr. Fox is worried how existing export barriers on medical goods may apply to vaccines when they are developed.  Moreover, many countries are dependent on open trade to avoid starvation.  Must understand of where we differ from the end of the financial crisis.  During the financial crisis only 0.7% of G20 trade was subject to trade restrictions. In 2018 more than 10% of G20 trade was covered by trade restrictions.  This change is a major problem. The G20 countries have to lead by example in terms of eliminating trade restrictions.  Getting an understanding that we are in a bad place and likely to worsen is important.  We cannot have business as usual.

Q: As the next Director-General, if selected, would you try to pick a particular sector (e.g., digital trade) to make progress?

A:  Dr. Fox believes that the next Director-General needs to look at connected problems – trade crisis, COVID crisis and environmental crisis — and see where the crises intersect.  Fisheries subsidies is all about sustainability.  The WTO needs to get NGOs and the young people who are concerned to put pressure on their governments.  As stated before, it is not just what happens in Geneva that is important but what happens in capitals.  An Environmental Goods Agreement is another potentially important issue.

Q:  The EU has been talking about a border carbon tax/tariff.  Where should WTO stand on carbon border adjustment mechanisms?

A:  This is going to be a big issue for the WTO.  For developed countries, a price should be paid to achieve reduced carbon levels.  The difficulty will come in the concept of a green subsidy.  If the subsidy becomes distortive in areas like agriculture, that will be problematic for many Members.  Then again the question of a carbon border adjustment mechanism is a political issue.  If we want to see environmental objectives met there will be a price to pay.

Conclusion

Each candidate has been very busy these last several months meeting with WTO Members both in Geneva and in capital (whether in person or virtually), talking to the media, doing events with academia and think tanks and others. The above additional materials on Dr. Fox are a small sample of what is available online. The excerpts or summaries from the various publications have largely been limited to some of the key issues my previous posts have examined (appellate body reform, industrial subsidies, etc.) or discussions of other issues of potential interest.

WTO Director-General candidates — Nigeria’s Dr. Ngozi Okonjo-Iweala and the United Kingdom’s Dr. Liam Fox generate potential controversy

Dr. Ngozi Okonjo-Iweala (Nigeria)

Dr. Ngozi Okonjo-Iweala is Nigeria’s candidate to become the next Director-General. When she was put forward by the Nigerian government her biographical sketch submitted did not contain information on her having also become a citizen of the United States in 2019. Her biography as available from the WTO webpage is embedded below.

bio_nga_e

In the highly politicized atmosphere that characterizes the current dysfunction at the WTO, omitting her U.S. citizenship may become a liability to Dr. Okonjo-Iweala’s chances of becoming the next Director-General. Chinese and other news reports raise that very issue. See, e.g., South China Morning Post, September 4, 2020, Ngozi Okonjo-Iweala’s US passport will not help her chances in WTO leadership race, Chinese trade experts say, https://www.scmp.com/economy/global-economy/article/3100280/ngozi-okonjo-iwealas-us-passport-will-not-help-her-chances; Naija247News, September 2, 2020 (posting a Bloomberg News piece), WTO Hopeful Economist Okonjo-Iweala Balances Nigeria, U.S. Citizenships, https://naija247news.com/2020/09/02/wto-hopeful-economist-okonjo-iweala-balances-nigeria-u-s-citizenships/#.X1OeZ5PsZ9A.

The Rt Hon Dr. Liam Fox MP (United Kingdom)

In an article earlier this week, Inside U.S. Trade reported that Dr. Fox had indicated that the next Director-General should prioritize the U.S. Congress over the U.S. Administration (President and USTR) to seek a resolution of the WTO’s Appellate Body impasse, seeking Congress to mandate a resolution as part of its consideration of renewal of Trade Promotion Authority. See Inside U.S. Trade’s World Trade Online, September 2, 2020, Fox: Congress should leverage TPSA renewal to resolve WTO appellate impasse, https://insidetrade.com/trade/fox-congress-should-leverage-tpa-renewal-resolve-wto-appellate-impasse.

Congress may well have an interest in the topic as part of trade promotion authority. However, for a candidate seeking to be selected as the next Director-General of the World Trade Organization to suggest the path to progress is by circumventing the U.S. Administration seems likely to raise concerns about his objectivity. Circumventing the U.S. Administration essentially indicates Dr. Fox’s belief that the problem at the WTO on the issue is U.S. intransigence. While that may be the European Union view, articulating such a position is unlikely to win friends at USTR. While Dr. Fox apparently believes he has the U.S. support, his statement on the approach he would take as Director-General may result in the U.S. supporting others. The Inside U.S. Trade piece quotes Dr. Fox as saying that when he is being frank, it usually gets him in trouble. Time will tell whether his recent comments repeat that self appraisal.

The global number of confirmed COVID-19 cases passes 25 million with more than 843,000 deaths — increased race to lock up vaccine supplies

In my post of August 16, I suggested that it appeared that the global spread of COVID-19 may have peaked in the August 3-16 period. See August 16, 2020, Is the world at the peak of the COVID-19 pandemic?  Last two weeks suggest a peaking of the growth of global infections may be at hand, https://currentthoughtsontrade.com/2020/08/16/is-the-world-at-the-peak-of-the-covid-19-pandemic-last-two-weeks-suggest-a-peaking-of-the-growth-of-global-infections-may-be-at-hand/. Data compiled by the European Centre for Disease Prevention and Control show total new cases for the August 17-30 time period to be 3,558,360 compared to 3,624,548 for August 3-16 and 3,568,162 for the July 20-August 2 period. Thus, global new cases seem to have peaked or to have reached a plateau.

The United States which has more confirmed cases than any other nation and more confirmed deaths from COVID-19, had a second two-week decline in new cases. The U.S. recorded the extraordinary number of 908,980 new cases during the fourteen day period July 20-August 2. That number declined to 740,721 during August 3-16 and further declined to 600,417 new cases in the August 17-30 period. The most recent period is still 46.76% higher than what had been the prior peak during April 13-26 of 409,102 new cases. Even with the significant reduction in new cases in the August 17-30 period, the United States had the second largest number of new cases, following only India whose number of new cases is continuing to rise and were 953,051 in the last two weeks. Brazil maintains its hold on third place though its new cases are also falling since July 20-August 2 (633,017 new cases) to 609,219 new cases during August 3-16 and to 529,057 new cases during August 17-30. India, the United States and Brazil accounted for an extraordinary 58.5% of the new global cases during the last two weeks and account for 53.39% of all cases confirmed since late December 2019. The United States with 4.3% of global population has accounted for 23.82% of total confirmed cases since December 2019. With the declining numbers in the last two weeks, the U.S. was still 16.87% of new cases during August 17-30 or roughly four times the U.S. share of global population.

Continued growth of cases in the developing world

With the number of new cases in the United States declining, the trend to new cases being focused on the developing world continues although there has been some significant resurgence of new cases in a number of developed countries during the summer vacation period with a renewal of at least some international travel. While India and Brazil had by far the largest number of new cases from developing countries, they were followed by Colombia (143,225), Peru (113,632), Argentina (109,585), Mexico (73,998), Iraq (54,863), the Philippines (55,213), South Africa (38,898) and then dozens of other countries with smaller numbers of new cases.

Spain showed the largest increase of a developed country that had gotten the COVID-19 spread under control until recently. For August 17-30, Spain saw an additional 96,473 new cases. France added 57,009 new cases; Germany saw 17,538 new cases. Other countries in Europe as well as Japan and Korea also saw significant additional new cases.

Deaths/100,000 population

The United States has the largest number of deaths of any country to date (182,779) and had the second largest number of deaths in the last two weeks (13,298) behind only India (13,518). The countries with the highest number of deaths per 100,000 population were the following: Colombia (8.45), Bolivia (8.12), Peru (7.79), Brazil (6.27), Argentina (6.12), Mexico (5.70), Panama (5.58),Chile (4.15), United States (4.04). All other countries (including all other developed countries) had lower rates of death per 100,000 population. For all countries, the death rate over the last two weeks was 1.01 deaths/100,000 population.

If looking at the entire period since the end of December 2019 through August 30, the average number of deaths for all countries per 100,000 of population has been 11.10 deaths. The nine countries (of 71 which account for 98% of total deaths) with the highest death rates/100,000 for the full period are: Belgium (86.34), Peru (87.99), United Kingdom (62.27), Spain (61.81), Chile (59.00), Italy (58.77), Brazil (57.08), Sweden (which did not impose any restrictions)(56.90), the United States (55.54). With the exception of Brazil, Chile, Peru and the United States, each of the other top countries overall has shown a drastic reduction since their peaks in April and as reflected in the experience in the last two weeks (all the European countries were less than 1 death per 100,000).

Race for vaccines

There have been many press articles looking at efforts by the United States, by the EU and by others to lock up large quantities of vaccines from companies whose vaccines are in third phase trials for early availability to their populations. See, e.g., European Commission, 14 August 2020, Coronavirus: Commission reaches first agreement on a potential vaccine, https://ec.europa.eu/commission/presscorner/detail/en/ip_20_1438. The Russian Federation has released a vaccine that did not go through a third phase trial and has received interest from some developing countries. After international criticism, the Russian Federation is now pursuing Phase 3 trials. AP, Putin touts Russia’s COVID-19 vaccine as effective and safe, August 27, 2020, https://apnews.com/f505b2fe730b56b558b8f76bf1932af0.

China has been promising some trading partners preferential access to its vaccines. See, e.g., Wall Street Journal, August 17, 2020, China Seeks to Use Access to COVID-19 Vaccines for Diplomacy, https://www.wsj.com/articles/china-seeks-to-use-access-to-covid-19-vaccines-for-diplomacy-11597690215

For the Philippines, their President has been shopping with the U.S., Russia and China for early access. See, e.g., Nikkei Asia, August 11, 2020, Duterte takes Russia’s offer of COVID vaccine after asking China, https://asia.nikkei.com/Politics/International-relations/Duterte-takes-Russia-s-offer-of-COVID-vaccine-after-asking-China.

Beyond the national or regional efforts to secure priority for vaccines when developed, joint efforts continue as part of the WHO effort to ensure that vaccines and other medical goods relevant to addressing COVID-19 are available equitably to all people and at affordable prices. See, e.g., European Union, Coronavirus Global Response, https://global-response.europa.eu/index_en.

So while it may not be surprising to see countries looking first and foremost about the health of their own citizens, the World Health Organization has warned that no one is safe until all are safe from the COVID-19. The next six months to a year will be a test of whether the efforts of many to provide funding and other resources to ensure greater equitable access to vaccines at affordable prices can coexist with national efforts to prioritize their own citizens.

Conclusion

The world in the first eight months of 2020 is struggling to get the COVID-19 pandemic under control. While many countries in Europe and some in Asia and the major countries in Oceania have greatly reduced the number of new cases over time, there has been some resurgence in many of these countries as their economies reopen, travel restrictions are eased and as schools reopen in many countries. But the number of new cases continues to rage in much of the Americas (other than Canada), in parts of Asia (in particular India) and in parts of Africa. Since most new cases are now in developing countries, it is unclear how many of these countries will be able to handle a significant number of cases, whether their healthcare infrastructure will be overwhelmed and whether they will have the medical goods needed to handle the cases safely.

August has seen the global number of new cases peak and possibly start to decline. That is some good news although the number of new cases on a daily basis continues to strain the global supply system.

The progress on developing safe and effective vaccines is encouraging and has been sped by the willingness of major economies like the U.S. and the EU to fund manufacturing ahead of actual approval of the promising vaccines. While this puts a lot of money at risk should one or more of the vaccines in trials not prove safe or effective, it saves a great deal of time in getting product to market if approved. In a global economy in which least developed countries, small and vulnerable economies and other developing countries are experiencing significant economic challenges because of travel restrictions and trade contractions flowing from efforts to address the pandemic, achieving equitable and affordabale access to vaccines when available is a global imperative. Time will tell if the imperative is achieved or not.

The race to become the next WTO Director-General — where the candidates stand on important issues: fisheries subsidies and e-commerce/digital trade

[Updated on August 27 to incorporate comments by Amb. Tudor Ulianovschi of Moldova at a WITA webinar held on August 26.]

The eight candidates for the position of Director-General of the World Trade Organization, in looking at what topics should be moved forward or completed in negotiations were uniformly in support of an early conclusion to the negotiations on fisheries subsidies and on updating the rule book by moving the plurilateral negotiations on e-commerce/digital trade forward to at least a draft document by the twelfth WTO Ministerial Conference in 2021.

Background on fisheries subsidies

Fisheries subsidies have been subject to negotiation within the WTO since the launch of the Doha Development Agenda in December 2001 with limited forward movement in recent years. With the world’s wild caught supply of fish under severe pressure from overfishing, curbing illegal fishing and overfishing through subsidy disciplines became part of the UN’s Sustainable Development Goals in 2015 (Goal 14.6)(SDG). This led WTO Members at the eleventh Ministerial Conference in Buenos Aires to commit to completing the negotiations on fisheries subsidies by the twelfth Ministerial Conference which was scheduled for early June 2020 to permit completion within the time frame laid out in the UN SDG. With the COVID-19 pandemic and the lockdown in Geneva and in many countries, the time frame for completing the fisheries subsidies has slipped, although in late June, the Chair of the Rules Negotiating Group released a draft consolidated text to permit Members to see if a final push to complete negotiations could be made possibly yet in 2020. I have reviewed the fisheries subsidies in a number of prior posts. See, e.g., June 29, 2020, Update on fisheries subsidies draft consolidated text from June 25, https://currentthoughtsontrade.com/2020/06/29/update-on-fisheries-subsidies-draft-consolidated-text-from-june-25/; June 27, 2020, Chair of Rules Negotiating Group releases draft consolidated fisheries subsidies text at informal meeting on June 25, https://currentthoughtsontrade.com/2020/06/27/chair-of-rules-negotiating-group-releases-draft-consolidated-fisheries-subsidies-text-at-informal-meeting-on-june-25/; January 13, 2020, Fisheries Subsidies – Will the WTO Members Reach Agreement Before June 2020? https://currentthoughtsontrade.com/2020/01/13/fisheries-subsidies-will-the-wto-members-reach-agreement-before-june-2020/.

Background on electronic commerce/digit trade

The agenda for the Uruguay Round was established in 1986 with negotiations completed in 1993 and the agreements that created the WTO signed in 1994. At that time, there was little electronic commerce. The driver of world economic growth over the last twenty-five years has increasingly been the rapidly developing technology that permits large amounts of communication and business activity to occur electronically. Music, movies, television, books, magazines have largely gone digital. Consumer purchases of goods and services have increasingly been done digitally. During the COVID-19 pandemic much of the world has depended on electronic communications to buy groceries, handle some medical needs, eliminate in person meetings replaced by virtual meetings and much more.

While the WTO as early as the second Ministerial Conference in 1998 agreed to study issues surrounding electronic commerce to develop rules that might be necessary, the WTO’s efforts have struggled for more than twenty years with periodic agreement to continue the review and extend a moratorium on customs duties on electronic commerce. See, e.g., Work Programme on Electronic Commerce, adopted by the General Council on 25 September 1998, WT/L/274 (30 Sept. 1998); Work Programme on Electronic Commerce, Ministerial Decision of 13 December 2017, WT/Min(17)/65, WT/L/1032 (18 December 2017). These two documents are embedded below.

274

65

At the eleventh Ministerial Conference in Buenos Aires, WTO Members with an interest in particular issues issued Joint Statement Initiatives basically indicating that the group of listed Members were going to move forward developing potential rules on the subject matter of interest, keeping the process open to any Member wishing to participate. One of the Joint Statements was on Electronic Commerce. See JOINT STATEMENT ON ELECTRONIC COMMERCE, WT/MIN(17)/60 (13 December 2017). The statement is embedded below.

60

The JSI on e-commerce has been making good progress under the leadership of Australia, Japan and Singapore. A review of progress from the March 5 General Council meeting minutes is copied below (WT/GC/M/182 at 117):

“47. Australia (Joint Statement Initiative on Electronic Commerce)

“I will first provide a report on negotiations under the Joint Statement Initiative on Electronic Commerce on behalf of the co-convenors: Australia, Japan and Singapore.

“I will start with a short summary of the informal meeting of Ministers on the Ecommerce JSI held in Davos on 24 January.

“At this meeting, Ministers underscored the importance of this initiative both commercially and systemically for the WTO and affirmed their commitment to a high standard outcome, with the participation of as many WTO members as possible.

“Ministers welcomed the good progress achieved over the first year of negotiations, including the range of proposals received, the diversity and growing number of participants, and the strong levels of engagement in negotiating rounds.

“Ministers emphasized the need to keep working hard to ensure substantial progress by MC12 and agreed to develop a consolidated negotiating text by MC12 and a pathway for the future conclusion of the negotiations.

“The Philippines also announced it would join the JSI, bringing the number of signatories to 83, representing over 90% of global trade.

“Since our last report at the December HODS/TNC, we have held an organisational meeting, on 16 December, that set a work plan leading up to MC12.

“We also convened a negotiating round from 11-14 February, which covered electronic transactions, non-discrimination and liability, consumer protection, transparency, domestic regulation, cooperation and telecommunications. These negotiations were structured around revised streamlined texts drawn from proposals made by Members, and made further progress on streamlining text.

“Two more rounds are scheduled before MC12: 17-20 March and 28 April-1 May.

“We look forward to a continuation of the constructive engagement and momentum demonstrated in February with the aim of developing a consolidated negotiating text by MC12.

“The co-convenors continue to ensure this JSI is transparent and inclusive: meetings are open to all WTO Members; and all proposals and reports are available on the WTO’s web portal.”

The JSI group had hoped to have a consolidated draft text by the 12th Ministerial Conference in June this year before the Ministerial Conference was cancelled because of the pandemic. While the COVID-19 pandemic has slowed down progress for a few months, the joint convenors (Australia, Japan and Singapore) remain confident that a draft agreement can be achieved with a roadmap for completion by the 2021 Ministerial. Most documents generated by the JSI group are not publicly available. However, the titles of documents are available publicly. As of August 21, 70 documents are listed as having been submitted by Members on the JSI on electronic commerce. The most recent document is dated August 19 and is titled a “Stocktake text” (INF/ECOM/57). A July 23 document is titled “Facilitator’s note – Services Market Access — List of Proponents’ sectors of interest”).

Statements by the eight candidates seeking to become the next WTO Director-General

What follows are excerpts from candidates’ prepared statements to the General Council, my notes of their responses to questions at their press conferences following meeting with the General Council, and my notes on their comments at webinars hosted by the Washington International Trade Association (WITA) and the Asia Society Policy Institute.

Dr. Jesus Seade Kuri (Mexico)

In his prepared statement to the General Council on July 15, Dr. Seade listed completion of the fisheries subsidies negotiations as an issue to be resolved in the first 100 days of his becoming Director-General. The Joint Statement Initiative (JSI) on E-commerce was one of a number of JSIs announced at the 11th Ministerial Confernce in Buenos Aires in 2017. Dr. Seade included all JSIs as areas where he would be expecting concrete results by June 2021.

“1. Within the first hundred days: I will work closely with
members in seeking to i. reach agreement on fisheries subsidies.” (Google translation from French).

“2. Second horizon, towards our MC12 conference, and aware of the fact that its date is not yet fixed, it is important that we look for concrete results
by June 2.021, both in joint initiatives and in issues that aim to give us a more transparent and effective WTO.” (Google translation from French).

At his press conference on July 15 after his meeting with the General Council, Dr. Seade was not asked any questions about the fisheries subsidies negotiations or about the e-commerce JSI.

WITA had a webinar with Dr. Seade on July 7. https://www.wita.org/event-videos/conversation-with-wto-dg-candidate-seade/. During the webinar, Dr. Seade was not asked specifically about either the fisheries subsidies negotiations or about the Joint Statement Initiative on E-commerce. However, he was asked a question on whether, if he was selected as the next Director-General, he would encourage plurilateral negotiations. All of the JSIs are plurilateral negotiations open to any Member who wishes to join. Below are my notes on the question asked and Dr. Seade’s response on plurilaterals.

Q: On the role of plurilaterals in the WTO, would you encourage their use if you are selected as the next Director-eneral?

A:  On plurilaterals, Dr. Seade tries to take a pragmatic and historic approach.  Looking at the history of the multilateral trading system, the Tokyo Round created a host of plurilaterals which were powerful to create rules that were accepted by many of the most important countries on a range of subjects (AD, Subsidies) — the so-called Tokyo Round Codes.  It was a great way to move the process of liberalization forward.  In Dr. Seade’s view, the great achievement in the Uruguay Round was to move to substantively universal rules (agriculture and textiles which had previously been outside of GATT rules were brought inside; the Tokyo Round Codes moved to Agreements applicable to all).  The Uruguay Round was possible because there were huge inducements for developing countries to accept services, TRIPs in exchange for textiles and agriculture liberalization.  However, the negotiating environment has changed. It is no longer possible to get liberalization through negotiations just betweenthe U.S. and the EU where the results are then accepted by others (e.g., agriculture). Now negotiations need to include China, India and others who need to be part and where large differences in objectives may make multilateral negotiations more difficult.  Therefore the WTO needs plurilaterals to permit forward movement.  However, the WTO and its Members need to work largely on the basis that any benefits from plurilaterals will be provided to all Members and that the agreement is open to any Member to join later if desired.  In Dr. Seade’s view, if the WTO doesn’t allow use of plurilaterals, progress at the WTO will stop.

Dr. Ngozi Okonjo-Iweala (Nigeria)

Dr. Okonjo-Iweala mentions both concluding the fisheries subsidies negotiations and updating the WTO rules to include rules on e-commerce. She adds the need to bridge the digital divide so that any such rules will have broader application and broader input.

“The WTO appears paralysed at a time when its rule book would greatly benefit from an update to 21st century issues such as e-commerce and the digital economy, the green and circular economies. Issues of women and trade and Micro Small and Medium Enterprises (MSMEs) are important to ensure greater inclusion. Bridging the digital divide to enable Least Developed Countries and other developing countries to participate will be key.”

“My vision is also of a rejuvenated and strengthened WTO that will be confident to tackle effectively ongoing issues such as the fisheries negotiations. With political will, outstanding issues of subsidies that lead to overfishing and unsustainable fishing can be concluded.”

“A rejuvenated WTO must also take on fresh challenges, such as ensuring optimal complementarity between trade and the environment and ensuring that WTO rules best respond to the realities of e-commerce and the opportunities and challenges of the digital economy.”

“Should I be elected, I would work with Members to prioritize delivering a successful MC12 with good outcomes on fisheries, agriculture and other areas. I would also prioritize updating the rulebook * * *.”

During the press conference on July 15 after her meeting with the General Council, Dr. Okonjo-Iweala was asked a question on what progress in negotiations was achievable by the next Ministerial Conference and was also asked a question on how she would work towards ensuring a successful outcome on e-commerce negotiations. My notes on her responses to those questions follow.

On the question of what is achievable by the next Ministerial in 2021 and whether it is best to go after issues one at a time or in a larger grouping, Dr. Okonjo-Iweala indicated that she hoped the WTO Membership would make a decision soon on who should be Director-General so whoever is selected has more time before the next Ministerial. But even if a decision is not made until November 2020, there are some areas that could be ready by the next Ministerial. For example, a fisheries subsidies agreement should be achievable. There was a lot of discussion in the General Council on trust and building trust to move negotiations along. Trust is obviously an important issue. So the WTO may need to sequence issues to build trust by achieving a win or two. Once there are some successes, it should be possible to handle more issues in parallel.

The question on what Dr. Okonjo-Iweala would do as Director-General to see that an agreement on e-commerce was pursued was answered by noting that there was extensive work being done plurilaterally by many Members as one of a number of joint statement initiatives. Dr. Okonjo-Iweala agrees that an agreement on e-commerce is very important, but she notes that there is a digital divide where many poorer countries don’t have the infrastructure to take advantage of e-commerce. The WTO, working with other multilateral organizations, needs to see that resources are put together to help countries address the digital divide. Once the digital divide is addressed, all Members should want to and be able to participate in the e-commerce negotiations, so that the agreement becomes a multilateral one.

WITA had a webinar with Dr. Ngozi Okonjo-Iweala on July 21. https://www.wita.org/event-videos/conversation-with-wto-dg-candidate-dr-ngozi-okonjo-iweala/. During the webinar, Dr. Okonjo-Iweala made an opening statement in which she reviewed the need to generate some early wins for the WTO at the 12th Ministerial Conference including both fisheries subsidies and e-commerce. Dr. Okonjo-Iweala was also asked speciically about e-commerce and digital trade and how to move those talks forward. Below are my notes on those portions of the webinar.

Dr. Okonjo-Iweala stated that the WTO is really at a critical moment, an existential crisis.  She believes that something needs to be done to give a lift to the organization.  Dr. Okonjo-Iweala would focus as Director-General on the next Ministerial Conference and what wins could be obtained at the Conference.  She believes that concluding the fisheries subsidies negotiations with its issues of overcapacity and overfishing should be pursued and could be concluded even before the Ministerial Conference.

Dr. Okonjo-Iweala also believes that the WTO must update the rule book to cover 21st century issues.  As she has noted, the digital economy is driving the world during the COVID-19 pandemic and is of great importance to many Members.  Dr. Okonjo-Iweala believes that the WTO needs to develop rules for e-commerce as e-commerce is the future of much of trade. At the same time, the WTO must address the digital divide so participation and benefits are available to all.

Q: On e-commerce and digital trade, how do you see rules being developed? Should the rules be based on the historic principles of the WTO?

A:  Dr. Okonjo-Iweala believes that ecommerce and digital trade are very important topics. The WTO must ensure two things. First, traditional WTO principles should apply (non-discrimination, etc.).  She believes that it would be important to get many more countries to join the talks. Stated differently, Dr. Okonjo-Iweala believes the WTO should always prefer a multilateral negotiation and agreement. However, sometimes plurilaterals are needed to make progress.  Second, the WTO working with other organizations needs to address the digital divide. In Dr. Okonjo-Iweala’s view, the fact that many developing countries are not participating flows from the fact that they don’t have the infrastructure to engage in e-commerce to a significant extent and hence neither participate in the talks nor gain benefits.  This is the digital divide.  WTO is not a financial institution, so the WTO needs to team with other organizations to help developing countries overcome the digital divide which will permit these Members to then participate in the negotiations.  Dr. Okonjo-Iweala also believes that the level of commitments under an e-commerce agreement will need to vary based on the ability of Members to accept obligations and to contribute.

Mr. Abdel-Hamid Mamdouh (Egypt)

Mr. Mamdouh’s prepared statement to the General Council on July 15 identified both fisheries subsidies and the various Joint Statement Initiatives, including e-commerce, as priorities for movement by the 12th Ministerial Conference (MC12).

“For the immediate future, we need to set clear priorities. MC12 is around the corner and it needs to be a turning point in the direction of the WTO and take it on a different path towards ‘positive territory’. I believe we need to do two things: 1) agree on a reform agenda and 2) achieve concrete progress on issues currently under negotiation.

“On current negotiating subjects, fisheries subsidies come first as the one item expected to be concluded by the end of 2020. It is crucial for our future to have a successful conclusion of the fisheries subsidies negotiations.

“There are also the Joint Statement Initiatives on e-commerce, domestic regulation in services, MSMEs and investment facilitation. These initiatives address pressing issues of importance to many Members and pause new challenges.”

During Mr. Mamdouh’s press conference after his meeting with the General Council, he was asked one question about the agenda for the twelfth Ministerial Conference which resulted in an answer that included pursuing completion of the fisheries subsidies agreement and work on the Joint Statement Initiatives. My notes on Mr. Mamdouh’s response is provided below.

Mr. Mamdouh was asked if there will be enough time to prepare for the next Ministerial to have a positive agenda/outcome. He answered that if the selection process concludes before November, there should be sufficient time. In his view, the next Ministerial needs to be a turning point for the WTO. At MC12, the WTO must have a clear agenda for reform. There is not currently a mainstream focus on reform; issues are being raised ad hoc. Second, the WTO needs to score successes – fisheries subsidies and progress on joint statement initiatives are the likely areas for success.

WITA had a webinar with Mr. Mamdouh on June 23. https://www.wita.org/event-videos/conversation-candidate-hamid-mamdouh/. During the webinar, Mr. Mamdouh was asked a question about e-commerce and was also asked his views on plurilaterals and whether he would support their use if he becomes the next Director-General. As all of the Joint Statement Initiatives involve plurilateral negotiations, the question applies to e-commerce along with the other JSIs. Below are my notes on the questions and Mr. Mamdouh’s responses.

Q: U.S. has raised various issues of importance to them. How do you see elements of a reform agenda getting U.S. support if U.S. concerns are not addressed or included in the agenda?

A: Mr. Mamdouh indicated that U.S. concerns were being examined at the WTO. He took e-commerce as an example. Looking at the e-commerce agenda at the WTO, Mr. Mamdouh is of the view that there needs to be discussions that haven’t taken place at the WTO in a very long time.  Trade issues today are of increased complexity where issues of increased trade liberalization are juxtaposed with regulatory interests. E-commerce/digital trade has a slew of legitimate regulatory issues where Members can have very different perspectives. Examples would include privacy policies, cyber security, localization among others.  In Mr. Mamdouh’s view, these regulatory policy issues are both legitimate and of different importance to different Members.  So the question arises as to how new rules deal with these diversities of Member needs while ensuring rules that respect different needs while ensuring actions by Members are the least trade restrictive  While the Sanitary and Phytosanitary Agreement and Technical Barriers to Trade Agreement are examples of issues with similar types of competing regulatory needs, many of the new issues are as or more complex. These new complex areas are not seeing discussions to date between trade folks, regulators and lawyers to help clarify the needs, challenges and options that may be available to permit WTO progress on fashioning new rules. In Mr. Mamdouh’s view, WTO Members must do a much better job of discussing issues and clarifying them so the options can be taken back home and reviewed to permit Members to get into real negotiations.

Q: Plurilaterals can be defined as agreements by like minded countries on topics.  How do you view plurilaterals and would you support them if you were selected as the next Director-General?  Should most favored nation treatment be eliminated for plurilaterals, so the benefits of plurilateral liberalization only goes to those who are participating?

A:  In Mr. Mamdouh’s view, one needs to clarify what is meant by plurilaterals.  Are we talking about plurilateral processes or outcomes?  Mr. Mamdouh views that there are two types of plurilaterals that have been pursued over time. The first is a plurilateral process that produces plurilateral outcomes — that is where the Agreement applies only to the signatories to that agreement. These are like the agreements in Annex 4 to the WTO (civil aircraft, government procurement, dairy and bovine meat). While these can be pursued they are less likely as they require the consent of all Members.  There are also plurilateral negotiations that produce multilateral outcomes. That is, the resulting agreement provides benefits to all even though the agreement was among some of the Members.  These are quite normal and are clearly within the spirit of the WTO.  Practically, Members engaged in plurilaterals will want there to be a critical mass of Members engaged for these types of plurilateral agreements to move forward. Moreover, Mr. Mamdouh noted that there is no requirement that all Members agree to the launch of plurilateral negotiations. That is not a requirement of the WTO and should not be assumed.  On the question of whether plurilateral agreements will opt increasingly to limit benefits to members, Mr. Mamdouh believes that the concept of most favored nation treatment in plurilaterals will undergo a stress test in the coming years as there are issues re reciprocity.    

Amb. Tudor Ulianovschi (Moldova)

On July 16, Amb. Ulianovschi was the first candidate to meet with the General Council. In his prepared statement when Amb. Ulianovschi got to what he thought the immediate priorities for the new Director-General should be, completing the fisheries subsidies negotiations and making progress on Joint Statement Initiatives were two of the priorities listed.

“In terms of immediate priorities for the future Director General of the WTO, the following should be considered (including in the preparation process for MC12):

“2. Build upon the progress achieved already on the fisheries subsidies negotiations and strongly support Members to achieve a negotiated text by MC12;

* * *

“4. Further encouraging and supporting discussions on new and existing Joint Initiatives, particularly: on Elecronic Commerce, Investment Facilitation for Development, Domestic Services Regulation, as well as the dialogs of the informal group on MSMES and SMEs and others.

“5. Promoting negotiations of new commercial disciplines and address issues of the digital environment and new areas of intellectual property.”

During Amb. Ulianovschi’s press conference after his meeting with the General Council, the last question he was asked had Amb. Ulianovschi point to the Joint Statement Initiatives (which include electronic commerce) as a sign Members could make progress on reform issues. Amb. Ulianovschi was not asked specifically about either fisheries subsidies or electronic commerce. My notes on the question asked and Amb. Ulianovschi’s answer are provided below.

Q: The last question asked was about getting the WTO out of crisis; in particular, what is the core factor causing the crisis and how would Mr. Ulianovschi address the factor if he was selected as Director-General.

A: Mr. Ulianovschi answered that this is an existential question for the WTO. The first priority, in his view, to get out of the crisis is for there to be trust among Members. The role of the Director-General is to enhance feelings of trust through confidence building steps. Many issues which have been unresolved for a long time have undermined trust. Joint initiative statement issues are advancing and give hope that the organization is relevant and can deliver. This is a good sign that there is a common purpose among the Members.

WITA held a webinar with Amb. Tudor Ulianovschi on August 26, 2020.  https://www.wita.org/event-videos/conversation-with-tudor-ulianovschi/. During the webinar, Amb. Ulianovschi was asked two questions where his response included views on the fisheries subsidies negotiations and/or on e-commerce/digital trade. My notes on the questions asked and on Amb. Ulianovschi’s responses are provided below.

Q:  If you are the next Director-General, what would be your priorities for the 2021 Ministerial Conference and how would you define success?

A:  In Amb. Ulianovschi’s view, the next Ministerial must show some results.  He believes the top priority would be completing the ongoing negotiations on fisheries subsidies, which is important to fulfill U.N. Sustainable Development Goal 14.6.  He believes that the Members are close to getting language agreed to.  Completing the fisheries subsidies agreement Is just the first step, but it is an important one.  He would also focus on ongoing Joint Statement Initiatives (JSI) such as on  digital trade/e-commerce.   JSIs are plurilateral negotiations as opposed to multilateral ones.  As seen by Members during the COVID-19 pandemic, digital trade is of growing importance.  A key question is how to help least developed countries get involved and get help building the infrastructure so such Members can participate.  Also Members will need to deal with a range of issues surround digital trade such as cybersecurity, privacy, etc.  Amb. Ulianovschi stated that a Ministerial declaration would be expected at the 2021 Ministerial on e-commerce.  He also noted that there are other JSIs as well that are being discussed.  He believes that at the next Ministerial Members should have a clear message of support for small, medium and micro enterprises.  Such enterprises are a huge issue for most Members.  Many of these businesses are being severely challenged by the COVID-19 pandemic and many will likely go bankrupt.  WTO Members need to help identify how the WTO and other organizations can work with them (financial institutions and ICC). 

Q:  You say that business as usual isn’t viable anymore.  What has changed?  If plurilateral work is where we are headed,  do we need to rethink the most favored nation principle?

A:  Amb. Ulianovschi stated that when one looks at the WTO, one sees that there is a lack of trust which in turn has meant there is lack of forward movement on negotiations.  Thus, it is clear that  business as usual isn’t working.  But that recognition doesn’t mean that the organization starts from zero.  What is clear is that things need to change.  The WTO is not responding to 21st century issues which cannot continue if the organization is to maintain relevance.  On the issue of multilateral vs. plurilateral negotiations, the only multilateral negotiation that is proceeding is on fisheries subsidies.  As noted, Amb. Ulianovschi hopes that the fisheries subsidies negotiations will be completed by the next Ministerial in 2021.  Where trust is lacking, he belives Members need to seek progress from the bottom up – finding like-minded Members who are concerned about an issue and willing to negotiate rules on the issue.  Plurilaterals are going on (JSIs are an example).  This is a good sign as plurilaterals show that a number of members are concerned with a topic.  Any plurilateral negotiation must be done in a transparent and inclusive manner.  Based on his discussions with Members, Amb. Ulianovschi knows that there is a large support for keeping MFN applicable to benefits from plurilaterals.

H.E. Yoo Myung-hee (Republic of Korea)

Minister Yoo in her prepared statement to the General Council identified both fisheries subsidies and the JSI on electronic commerce as priorities for the 12th Ministerial.

“MC12 will be a critical milestone of Members’ ability to deliver results and set the agenda for the future. The new Director-General must help make it a success in order to build trust in the WTO.

“A successful outcome on fisheries subsidies will demonstrate the credibility of the WTO and its ability to contribute to global objectives on sustainable development. It will also provide the world with the benefits for
trade and environmental sustainability. I will do everything I can to support these negotiations and bring them swiftly to a successful conclusion, for endorsement by Ministers at MC12.

“Electronic commerce is also an area in which we should work towards tangible outcomes. The COVID-19 pandemic has highlighted the importance of this issue. A comprehensive agreement by next summer may be ambitious, but I think we can take some concrete steps and lay out the path forward for post-MC12 work.”

During Minister Yoo’s press conference after her meeting with the General Council, she was asked questions on how she would restore trust if selected the next Director-General and how she would bring major Members onto issues being considered. Fisheries subsidies and e-commerce are mentioned in one or the other answers. My notes on the questions and answers provided are presented below.

Q: A question was asked as to how Minister Yoo would restore trust if selected as the next Director-General.

A: Minister Yoo noted her experience in negotiating trade deals with all level of countries around the world. She knows what it takes to negotiate and what it takes to bring negotiations to a close. She is confident that she can earn confidence from Members and achieve tangible outcomes. The key is to obtain even a small success at the MC12 (e.g., fisheries subsidies agreement by then) which would help build trust and convince the world that progress can happen at the WTO.

Q: What does it mean for the WTO to be relevant, and how would you bring on major members who may not agree with the issue being considered?

A: Minister Yoo stated that the WTO needs to revitalize its negotiating function and must be able to enforce its rules (by restoring the Appellate Body). Given 21st century realities, the WTO needs to update its rule book and to achieve agreement on issues that have real global effects such as the joint initiative efforts on e-commerce, MSMEs, investments, and other issues. That said, there are open issues from The Doha Development Agenda that are not moving because there are different views on how to move forward. In terms of how you bring members to the negotiating table, part of the answer is to obtain small successes to build trust and momentum.

WITA had a webinar with Minister Yoo on August 11.  https://www.wita.org/event-videos/candidate-h-e-yoo-myung-hee/. During the webinar, Minister Yoo was asked both about the e-commerce negotiations and about the ongoing fisheries subsidies negotiations. My notes on the questions and her responses are provided below.

Q: How important is it to move forward with a WTO reform agenda? In particular digital trade and e-commerce have become much more important to global trade during the pandemic.  How important is it for the WTO to address the lack of rules on digital trade and e-commerce?

A:  Minister Yoo indicated that the negotiations on e-commerce were important before the pandemic and are even more important now. Thus, it is critical to have successful negotiations.  WTO reform is very important generally.  All three pillars of the WTO — negotiations, dispute settlement and notifications and monitoring — need to be strengthened.  The WTO rule book was largely created 25 years ago.  Minister Yoo noted that the world didn’t have the smart phone or even much e-commerce back then.  So the existing WTO rules are limited in their ability to deal with current commercial reality.  It is important that the WTO achieve an agreement on e-commerce to show that the WTO can adapt to 21st century needs.  That said, Minister Yoo cautioned that Members have different views on various aspects of e-commerce.  She believes there are some low hanging fruit — e-signature and trade facilitation issues — that Members could be able to agree on relatively quickly.   However, Minister Yoo also noted that there are difficult issues in e-commerce tied to other government policy objectives — e.g., data transfer, localization — that may take longer to reach agreement on.  In tackling the more difficult set of issues, WTO Members need to look to see if the proposed rule serves a legitimate policy objective of Members.  If yes, then Members need to see if there is a way to achieve the objective in the least trade restrictive manner while facilitating e-commerce.  Considering the full set of issues that are present in the e-commerce talks, it may be too ambitious to achieve an agreement by the 12th Ministerial Conference in 2021.  Hopefully, WTO Members engaged in the talks can achieve a consolidated text by the Ministerial.  And then hopefully Members could agree on a path forward.  Minister Yoo is optimistic that Members will be able to come up with an ambitious agreement.

Q: Fisheries subsidies negotiations were hopefully going to conclude by this summer before the COVID-19 pandemic delayed negotiations. What are your thoughts on how talks can be brought to a successful conclusion?

A:  Minister Yoo stated that the fisheries subsidies negotiations are important to conclude to show the continued relevance of the WTO. The fisheries subsidies negotiations are the only multilateral talks at the WTO that are active (most others are plurilateral).  Achieving agreement on fisheries subsidies can also contribute to the UN’s sustainable development goals.  For both reasons, concluding the negotiations is very important.  Minister Yoo believes that Members should focus their energies on completing the negotiations by the end of this year so that the agreement can be endorsed by Ministers at the next Ministerial Conference in 2021.  For the next Director-General, the most urgent agenda item is to help facilitate the conclusion of the fisheries subsidies talks by the end of this year or at the very latest by the next Ministerial Conference in 2021.

H.E. Amina C. Mohamed (Kenya)

Minister Mohamed was the last candidate to appear before the General Council on July 16. Minister Mohamed did not address specifically either fisheries subsidies or the Joint Statement Initiative on e-commerce in her prepared statement to the General Council.

Similarly, during Minister Mohamed’s press conference after her meeting with the General Council, she was not asked a question dealing specifically with fisheries subsidies or the Joint Statement Initiative on e-commerce, nor did she include mention of either in answer to any of the questions asked.

WITA had a webinar with H.E. Mohamed on August 6. https://www.wita.org/event-videos/ambassador-amina-mohamed/. During the webinar, Minister Mohamed referenced digital trade in her opening comments and was asked a question about plurilateral negotiations. As noted before all of the Joint Statement Initiatives (including e-commerce) are plurilateral negotiations . My notes on her comments on these issues are provided below.

Opening statement:  Once the world recovers from the pandemic, the WTO will still face challenges of renewal and updating the rules to address global issues such as climate change, the digital revolution, and sustainable development.

Q: on developing new rules at the WTO, it has proven difficult to get agreement among all Members.  This has led to many Members turning to plurilaterals to achieve progress.  What are your views on plurilaterals?  Should MFN treatment of benefits be reconsidered where plurilateral agreements are the basis for liberalization or new rules?

A:  Minister Mohamed noted that plurilateral agreements are not new in the WTO; there were plurilateral agreements in the GATT.  She believes that plurilateral agreements will continue to be pursued and be part of the trading system.  Indeed, Minister Mohamed stated that the completion and/or start of plurilateral negotiations was a “good” that came out of the Nairobi and the Buenos Aires Ministerial Conferences in 2015 and 2017 respectively.  Countries that want to take on additional obligations will come together to negotiate new obligations for themselves.  In this way, plurilaterals complement the multilateral system.  Minister Mohamed stated that once there is a plurilateral agreement, it is important to share the benefits on an MFN basis if you want broad acceptance by Members.  Minister Mohamed had been the chair of the Nairobi Ministerial at which an update to the Information Technology Agreement (ITA2) was agreed to. Before the Ministerial, Minister Mohamed had had to travel to a number of capitals to get agreement to apply benefits on an MFN basis. At the end, the benefits of ITA2 are shared on an MFN basis and the agreement is open to all Members who want to join at a later date.  This led to unanimous acceptance of the ITA2 at Nairobi in 2015.  Minister Mohamed believes that it is important for ongoing plurilateral negotiations to ensure that the benefits are applied on MFN basis and that the agreement is open to all Members.

H.E. Mohammed Al-Tuwaijri (Saudi Arabia)

Minister Al-Tuwaijri was the first candidate to meet with the General Council on July 17. In his prepared statement, Minister Al-Tuwaijri identifies fisheries subsidies and e-commerce as two early deliverables for the WTO at the 12th Ministerial Conference in 2021.

“And finally, concerning the first question on what opportunities and solutions will emerge from current challenges, the existing delay in convening Ministers for the 12th Ministerial Conference may be a blessing in disguise. If we move quickly to take advantage of the opportunity of having an additional year to prepare, we could find and deliver solutions at MC12, particularly on fishery subsidies and electronic commerce and digital trade, which would demonstrate that the WTO can address issues in the public good – that would deliver on your goal of ‘optimal use of the world’s resources in accordance with the objective of sustainable development’ – while recognizing the contribution of e-commerce to economic growth in all markets, which has been emphatically affirmed during the COVID-19 pandemic.

“Although concluding the fishery subsidies negotiations would be a welcome sign that WTO Members can agree on something, we should not exaggerate the impression that this small step will make on our constituents. We need to aim higher, and the DG must work overtime to support a more complete agenda for the future of the WTO by MC12.”

During Minister Al-Tuwaijri’s press conference after meeting with the General Council, one question asked about WTO reform resulted in an answer by the Minister which provided both fisheries subsidies and e-commerce as issues where results by the 12th Ministerial Conference were possible. My notes on the question and Minister Al-Tuwaijri’s answer are provided below.

On the issue of WTO reform, Minister AlTuwaijri recognized that the WTO is a member driven organization. Second, the Director-General has a function to facilitate and to assess, but there is also room to improve the Director-General’s role. For example, the next ministerial (MC12) has been delayed til 2021. The delay provides an opportunity to improve the discussion at MC 12 and the outcomes that are possible. Bringing management and leadership skills to the Director-General position will permit setting goals, metrics for measuring progress in achieving those goals and providing a feedback loop on gaps that need to be addressed. Certain current issues should be achievable, such as fisheries subsidies and e-commerce. In the Minister’s view, COVID-19 and post-pandemic recovery provide the WTO an opportunity to address core needs of Members by doing a performance assessment. Where are the gaps in performance? Why did those gaps develop? How should the WTO proceed to eliminate the gaps? From his business and government experience, Minister Al-Tuwaijri knows that this type of transformation of the WTO to a more goal-oriented organization is possible.

WITA held a webinar with Minister Al-Tuwaijri on August 5, https://www.wita.org/event-videos/director-general-candidate-he-mohammed-al-tuwaijri/. During the webinar, Minister Al-Tuwaijri was asked his views on plurilateral agreements, which include the Joint Statement Initiatives such as the one on e-commerce. My notes on the question and Minister Al-Tuwaijri’s response follows.

Q: Do you see plurilateral negotiations as a good alternative to the lack of progress in multilateral talkes?

A:  Minister Al-Tuwaijri responded that his short answer would be Yes.  Members need to be able to move on where multilateral talks are blocked or not occurring.  So in Minister Al-Tuwaijri’s view plurilateral negotiations and agreements are part of the answer.  Because plurilateral agreements have existed for some time, Minister Al-Tuwaijri is interested in why some Members don’t join the agreement over time if the agreement is open to all and provides MFN benefits.  The answer to the “why” question is important if plurilaterals are to be more effective and lead to the agreements becoming multilateral over time.

The Rt Hon Dr. Liam Fox MP (United Kingdom)

Dr. Fox was the last candidate to appear before the General Council. His prepared statement has a section which reviews what Dr. Fox considers one of the new Director-General’s first tasks, delivering a successful 12th Ministerial Conference in 2021. Among the issues to be addressed are completion of the fisheries subsidies negotiations and progress on the Joint Statement Initiatives, including on e-commerce.

“Now, one of the first tasks for a new DG will be to deliver a successful 12th Ministerial Conference. The contents are, of course, for the members to agree but it is essential that the DG works with members to produce ideas and an agenda that, yes, excites us here at the WTO but is also seen as relevant outside. It must focus on outcomes, not process, helping the real businesses – large, medium, small and micro – upon which real prosperity depends.

“So what are some of our specific challenges?

“Well, despite remaining gaps, members are perhaps closer than they have been in the past to agreeing new rules to discipline harmful fisheries subsidies, and we must push for an outcome as soon as possible to meet the SDG goal set by Leaders. But, this is not just about fish, but about showing that the WTO can take steps on sustainability more generally – an area where members are rightly bringing forward other ideas, and where the public attach great importance.

“I know many members are also keen to make progress on Joint Initiatives on e-commerce, services, MSMEs and investment – these will be an important part of the discussions in the coming months.”

During Dr. Fox’s press conference after his July 17th meeting with the General Council he was asked one question on the types of reform needed. In his answer Dr. Fox mentioned fisheries subsidies as one topic. My notes on the question and his answer are provided below.

The last question inquired into what reform is needed. Dr. Fox articulated that reform should be viewed in three buckets. The first is conceptual reform. By this he means, Members recommitting to the basic principles of the WTO (most favoured nation, national treatment and transparency of commitments). He believes this is what MC 12 needs to focus on. The second is organizational reform. By this Dr. Fox means what does the team look like, the Director-General being first among equals; selecting Secretariat staff that are the most talented and challenging group. The third is policy reform. By that, Dr. Fox means what issues will be addressed — legacy issues and issues to update organization such as fisheries subsidies; resolution of the Appellate Body impasse. Dr. Fox concluded by saying that the Director-General position is a job for a politician and not for a technocrat at this time.

WITA had a webinar with Dr. Fox on July 30, 2020. https://www.wita.org/event-videos/conversation-with-dr-liam-fox/. During the webinar, Dr. Fox referenced each of the fisheries subsidies negotiations and updating the rules to cover e-commerce briefly. My notes on his comments are provided below.

Dr. Fox opined that the fisheries subsidies negotiations and around that the broader question of sustainability are issues which are not being addressed in the best way by the WTO Members.  The WTO and its Members don’t seem interested in using NGOs and young people who have a deep interest in the oceans by including them in the communication process so that there is better understanding that what the WTO is concerned about are issues of interest to the people of the world.  In Dr. Fox’s view, there is a disconnect between what the WTO is doing and what the general public is concerned about that has undermined the sense of joint endeavor that was important in the Uruguay Round.

Dr. Fox reviewed the importance of taking forward issues on e-commerce and trade in services. For Dr. Fox, the key question is how does the WTO bring its rule book up to date particularly on the changes in technology. Once the rule book is brought up to date, then the key is ensuring that all Members comply with the rules.

Conclusion

All eight of the candidates to become the next Director-General of the WTO view the completion of the fisheries subsidies as an important early objective and deliverable to demonstrate the WTO’s continued relevance. An agreement on fisheries subsidies would also help support the UN’s sustainable development goals.

All candidates also understand that there is an urgent need to update the WTO’s rule book with the most obvious example being the lack of agreed rules on electronic commerce and digital trade. All recognize that the role of digital trade has been critical to help countries during the COVID-19 pandemic and will be a critical aspect of global trade in goods and services going forward. The Joint Statement Initiative on e-commerce announced at the 2017 Buenos Aires Ministerial Conference currently has more than 80 WTO Members participating in the negotiations. Those Members account for more than 90% of global e-commerce. Reports from the co-convenors indicate the likelihood that there will be at least a consolidated text available by the next Ministerial Conference to be held in 2021. However, because the JSI is a plurilateral negotiation and not a multilateral one, it is envisioned that benefits will be available on an MFN basis (i.e., to all Members of the WTO whether part of the negotiations or not) and that the agreement will be open to all Members to join as desired.