Sadly Sitting Out the WTO

This week, international trade officials from around the world will gather in Nairobi to discuss improving rules governing access to the global marketplace, but many in business are staying away.

These every-so-often gatherings of trade ministers under the umbrella of the World Trade Organization (WTO) are meant to be lynchpins of the global trading framework, where economies advance new rules to smooth international commerce and facilitate economic development.

Unfortunately, success at these ministerials and more generally via the WTO has been sporadic and increasingly elusive, and countries appear prepared to agree on little if anything at the most recent gathering this week. As a result, many businesses and organizations are staying home, including ours. For the first time in more than a decade, we won't be turning up at a ministerial meeting.

Businesses turn up when there is something to turn up for. Two years ago, more than 80 chairmen and CEOs published a letter in the Financial Times that called for negotiators to complete an agreement to clear red tape and facilitate physical trade lanes during the last WTO ministerial in Indonesia. Plenty more senior executives and business groups descended on Bali in anticipation of a deal, which became the first truly multilateral agreement in the now 20 year history of the organization.

Global industry has also been deeply engaged in other initiatives under the WTO umbrella. One recent bright spot has been the negotiation of an expanded Information Technology Agreement meant to improve access to the technologies that underpin the ability of businesses and innovators to operate in the global digital economy.

Another is the thus-far dynamic and accelerated negotiations towards an Environmental Goods Agreement (EGA) that would eliminate tariffs on a range of environmentally friendly-products. Both sets of negotiations regularly bring businesses out to Geneva and have garnered broad support from global industry, including a letter released two weeks ago in support of an ambitious and swift conclusion to the EGA that was signed by more than 50 associations from Australia to China to Singapore to the United States.

This time out, it is clear that the Nairobi meeting will be short on deliverables. Officials are having trouble deciding on even the most basic of declarations and there is strong disagreement between parties about what if anything to say about the future of negotiations under the WTO umbrella. The gridlock on a broader Nairobi agenda also appears to be weighing down movement on the EGA and ITA agreements.

A large part of the problem remains what to say about the Doha Round, the long-suffering negotiating framework that economies locked themselves into with great hope and fanfare in 2001. There has been no bigger cheerleader than the business community for the kind of big-ticket, comprehensive multilateral trade pact that the Doha Round promised, but it is clear that prospects haven't just darkened, they have been extinguished.

Given the lack of prospects at the WTO, energy has been largely focused elsewhere, including on the Transpacific Partnership Agreement and venues such as the Asia Pacific Economic Cooperation forum, where smaller and more like-minded groups are often able to make progress on issues of importance to business.

The role of the WTO in enabling a global framework of rules for trade and investment has never been more essential. The Internet is unlocking the participation of millions of innovators and entrepreneurs in the global marketplace, magnifying the ability of trade to enable economic development and solve pressing challenges from combatting climate change to improving health outcomes. Efforts to improve the trade landscape under the WTO could facilitate innovators' global journeys and better lives for citizens and workers.

There is a need for the WTO to exist as a negotiating body, and pent up demand from business to engage. For that to happen, negotiators must identify clear and achievable pathways forward on issues that matter to industry. If it does not, the institution will increasingly become marginalized as a negotiating body.

Negotiators could send an important signal next year by wrapping up a commercially meaningful and environmentally-credible EGA. Through the EGA, members of the WTO have an opportunity to demonstrate that a group of like-minded members can achieve rapid progress on an agreement that can help solve the kind of pressing global challenges that were discussed over the last two weeks during the UN climate conference in Paris.

Officials must keep their foot on the gas to ensure the EGA does not fall into what has become a predictable pattern at the WTO of getting close to a deal and stalling when the going gets tough.

Beyond the EGA, economies will have an opportunity to reflect after Nairobi about new paths forward at the WTO. Are there more productive ways to approach longstanding issues involving agriculture and manufactured goods? How can the WTO begin to wrestle with other issues that either have not been part of its mandate or have received scant attention under existing work programs?

In Geneva and other international forums, developing country delegations have raised the possibility of work focused on micro, small and medium-sized businesses and on improving the public policy landscape for the global digital economy. Such areas could align with interests of global businesses and spark a range of stakeholders to engage in Geneva.

Whatever the outcome in Nairobi, the business community is ready to reengage in the WTO - so long as members of the WTO are ready to demonstrate the relevance of the institution and deliver commercially-meaningful outcomes.