The Shadows of WTO Irrelevance
Steve Charnovitz
14 December 2020
On 10 December 2020, WTO Deputy Director-General Alan Wolff gave a thoughtful presentation entitled “The WTO must not continue as it is.” In his speech, DDG Wolff warns that “if the WTO does not engage fully with environmental issues, with the existential threat of climate change … and does not address the suite of issues affecting well-being, the institution will move deep into the shadows of irrelevance.” Wolff further advises that “WTO Members must put sustainable development at the core of WTO reform efforts.” In particular, he recommends “discussions at the WTO” on “how” the WTO can ensure that “climate-related trade measures” contribute effectively to “transatlantic ambitions on climate change….” Wolff also calls for updating the WTO Secretariat’s “book” discussing the United Nations (UN) Sustainable Development Goals (SDGs) so as to help “WTO Members to engage and conclude negotiations that have a direct impact on achieving the SDGs.”
DDG Wolff’s suggestions are right in some ways and wrong in others.
Wolff, of course, is right that international trade, the environment, and sustainable development are interconnected. Looking back at my scholarship and activism on sustainable development over the past three decades, I would be the first to agree that the WTO should have an agenda related to the environment. See, for example, Charnovitz, “The World Trade Organization and the Environment”, Journal of International Environmental Law, 1998; Charnovitz, “The WTO as an Environmental Agency” in a 2008 UN University research volume.
Yet Wolff is wrong to seek to retrofit the WTO to be an agency with a “core” mission as nebulous as “sustainable development.” While this is not the place to discuss all of the weaknesses of the SDGs, I would note that the SDGs give short shrift to what is most valuable about the world trading system.
As I have written on this Blog and elsewhere for many years, what is moving the WTO toward irrelevance is not that the WTO is insufficiently green, but rather that WTO Member governments are being seduced by protectionism and nationalism in defiance of the rule of law in international trade. Any idea that the WTO can increase its relevance by flirting with green protectionism is foolish. To be sure, the Paris Agreement, now celebrating its 5th anniversary, has been unsuccessful in heading off the calamities of climate change. But the pathologies of the Paris Agreement cannot be fixed at the WTO. Seeking to do so will harm the WTO much more than it will repair the Paris Agreement.
As Wolff notes, looming unilateral “climate-related trade measures,” such as border carbon fees, will cause problems in the multilateral trading system. Unilateralism is being resorted to because the UN Framework Convention on Climate Change and its progeny since 1992 have not gotten around to addressing how international commerce should be dealt with in climate regulation and accounting. These complex issues are a fundamental challenge for the climate regime to solve.
For that task, the WTO can only be of marginal help. As an institution that has failed to consummate its green liberalization negotiation begun in 2001 on environmental goods and services, the WTO should be the last place anyone looks for enlightenment or encouragement to environmental regulators across the planet who are tackling the complex issues of reducing and sequestering greenhouse gas emissions. Successful international environmental negotiations have to be open to the participation of scientists, civic society, and transnational business groups. Unfortunately, the WTO remains largely closed to nongovernmental participation, although some transparency gains have occurred since the early WTO years (see Steve Charnovitz, “Transparency and Participation in the World Trade Organization,” Rutgers Law Review, 2004).
