Will an Indian Candidate become WTO Chief?

Subramaniya Swamy or Who could be other Indian candidates?

The negotiation of US-China trade deal was the beginning of dilution of institutional framework of WTO. It has survived the geopolitical trade war between US and China till now. The Covid19 poses a new challenge of “new normal” to this 25-year-old organization.  The new WTO Chief should be a person, who could broker peace between USA and China and build confidence among the members to revive the institution and agendas. The selection of incoming WTO Chief also offers an undeniable opportunity to test the Western powers willingness to accept meaningful changes suggested by developing countries in global trade governance. The new WTO chief selection is going to be critical and perhaps a New Internationalist is required to save its future.

China and other developing countries do not want the death of WTO. Even European Union is firm to nurture the baby, whom it grew Post World War II. In general, it could be said that USA is the only unhappy member about WTO, in public, but for its own reason.  In reality, most of the countries wish to protect its industries from cheap Chinese supply. The free trade proposers or critics on trade protection oppose infant industries argument without considering factors such as evolving technology, democracy and geopolitical power tacitly imbibed in this perpetual agreement.  China has steadily overcome this imbalance during last 42 years of market reforms and trade strategy. It is now ready and is challenging the Western Powers in their own game of globalization and alternative world order. Instead of isolating China in Western created multilateral institutions, the pre Covid19 acts of USA have weakened its own stature.  The post Covid19 scenario will not be easier than said.  The new era of Gun Boat Diplomacy will be started by both sides to gear up their geopolitical positions. In this background, the new WTO Chief will play pivotal role on global peace and prosperity.

Earlier, WTO Chief was selected on the basis of his competency to complete the Doha Round or Launched Round.  Now it will be done with the intent of who could preserve and protect WTO. Why to protect WTO? The declining trade and Covid19 environment may impose new kind of trade restrictions in accordance to new interpretation of WTO rules and create ballooning trade receivables or debt issues between countries. WTO will be the forum to take up and resolve such trade issues in a new way. The new WTO Chief will require to shape the WTO's agenda for the new post-COVID realities such as mounting protectionism and big-ticket WTO exit, with an alternative methodology, objective and vision. He or she has to keep a check and balance between globalization and nationalism in order to manage power equations and ambitions.  It could be a trusted candidate between East and West. 

The North Americans never held the chief position of GATT and WTO in the past.  The North America, Central America and Africa have brighter chance to assume this position, as they have never held this chair. Is Quad group going to present a joint candidate?

Neither an American nor a Chinese national has ever served as the WTO’s director-general since it was formed in 1995. Will USA allow the appointment of new WTO Chief until completion of US Election? Or Will it go like the Appellate Body Members appointment way?

In the past, the Europeans such as Peter Sutherland, Renato Ruggiero and Pascal Lamy, has held position of WTO Chief for 14 Years. Supachai Panitchpakdi, a Thai and Asian, and Mike Moore, a New Zealander i.e, oceanian held the position for 7 years. The current WTO Chief, Roberto Azevedo, a Brazilian, South American, is holding the position for last 7 years.   The GATT Chiefs such as Eric Wyndham White (A British, Period 1948 to 1968), Olivier Long, (A Swiss, Period 1968 – 1980), Arthur Dunkel (A Swiss, Period 1980 – 1983) were all Europeans.  From 1968 to 1993, the European Civil Servants, in particular Swiss national, were occupying the position of GATT Chief. Peter Sutherland was the first politician to head GATT and WTO. Perhaps, the closing of the Uruguay Round Agreement required a career politician instead of a civil servant in order to seal a deal in an amicable manner.  A notable fact is, since the inception of GATT and WTO, the Europeans have been holding the position of Chief for 49 years. 

Kim Chul Su, the Trade Minister of South Korea competed with Renato Reggiero for WTO Chief in 1995.  While accepting the candidacy of Renato, USA placed a condition that the successor of Renato should not be a European. In order to obtain withdrawal of Kim’s candidacy, the fourth Deputy Director General position was created to accommodate him.  In 1999, the race for WTO Chief between Mike Moore and Supachai Panitchpakdi was intense and bitter. It resulted in a compromise formula in that tenure between both. In 2005, Pascal Lamy competed against Luiz Felipe de Seixas Corrêa, Brazil's ambassador to the WTO; Jaya Krishna Cuttaree, the foreign affairs and trade minister of Mauritius; and Carlos Pérez del Castillo, Uruguay's former ambassador to the WTO for the position of WTO Chief. India did not back the Indian origin, Jaya Krishna Cuttaree, a Mauritius Minister. At that time, the WTO negotiations had just trade but not geopolitical implications.

The outgoing WTO Chief suggested that there should be a full time Chief to be appointed instead of an interim person.

An intense competition and rivalry will happen between US and China in the selection and the appointment. Just a few months back, US was heavily campaigning on behalf of a Singapore candidate for the position of WIPO Chief in order to prevent a Chinese candidate. It may be important to note that Chinese nationals are already heading four UN agencies, such as Food and Agriculture Organization, International Telecommunication Union, International Civil Aviation Organization and United Nations Industrial Organization. So there would be a Non-Chinese candidate campaign by US. The selection of WTO Chief will have a direct or indirect impact on US election. In the current environment, if America or China fields a candidate, it will be polarizing and will raise more tensions across the trade world. If there is a race between the US and the Chinese candidate, the loser will have strategic loss in global power.  Therefore, neither Chinese nor US will place their nationality in the race.  Though China or US may not promote its own candidate for WTO Chief, it could patronage a suitable candidate, which will   serve its interest in the present turmoil. Such competition will also be polarizing and will impose negative effects on global politics.  Perhaps most of the countries will endeavor to avoid rising of such a scenario.

The name of former EU trade chief Cecilia Malmström is also circulating in Geneva. The US and the European governments believe that French nationals always occupy the top positions of multilateral forums.  Eg. Dr. Dominique Strauss-Kahn (IMF MD, 2007 – 2011), Christine Lagarde (IMF MD  2011 – 2019) (Now in ECB), Jean Claude Paye Former OECD Chief, Pascal Lamy Former WTO DG, etc. But the eligibility of Cecilia Malmström may fly colorfully due to her Swedish origin.  Similarly, Germany could also promote a consensus candidate. The chances for an European candidate succeeding in the competition might look difficult as they have already held the position for so long since the inception of GATT and WTO. But in reality this argument may wither away if there is an aggressive project implemented “Save WTO” by Europeans.

The outgoing DG belongs to an emerging economy, a developing country in South America. So the candidature from South America is ruled out. Getting a consensus candidate could be a Non-US North American, Central American, Non-Chinese Asian or an African. A North American candidate could work but merely for a candidate belonging to Mexico or Canada. There is a growing feeling among trade diplomats that it’s Africa's turn to lead the trade organization. Several African names are circulating, but a unifying candidate has not emerged so far. An African or Central American Chief might struggle to strike bold compromises in the current geopolitical climate in order to revive the institution and agendas.

Many countries supported the independent investigation on the origin of Covid19 during the recent WHO assembly.  The reasons behind are domestic compulsion and politics. Europe is a divided house in the present geopolitical issue to support the candidature of US or China. If there is a US or Chinese candidate, the bi-product will be a testing case on future of European Union and old allies.  ASEAN countries are dependent on China in trade and investment. The momentum of RCEP at the height of pandemic indicates much more words and expressions on the position of Asian countries. Australia became silent after the imposition of an additional import tax by China on their Barley export to them.  Based on various scenarios, the new WTO Chief could belong to India, Canada, Japan, Australia, Vietnam, South Korea, Malaysia, Switzerland or Norway.

From a group of about 40 trading nations with the culture of consensus and negotiation, the WTO has now grown to 164 WTO members. New Zealand’s Permanent Representative Ambassador David Walker, the Chair of General Council WTO has got a critical role in the selection of WTO Chief. If past DDG appointments are examined, it exhibits the flavor of quid pro quo. Will the present environment create deadlock  to arrive consensus in candidature by 1^st September 2020? Since the WTO Ministerial Conference of June 2020 at Nur Sultan is postponed to June 2021, the big question and interpretation is that do the member countries intend to delay the selection of the new WTO Chief? A thin number of countries joining the MPIA initiative indicate in other way.  If WTO members are unable to pick a new director-general by 1^st September 2020, one of the four deputy director-generals may serve as an interim caretaker. They are Agah of Nigeria, Karl Brauner of Germany, Alan Wolff of the U.S. and Yi Xiaozhun of China.

The selection process is going to consume more energy.  It looks perhaps to take more time beyond September 2020. In an extraordinary time like this, if a weak candidate is selected, it will end the future of WTO and create more chaos to the world, economically, socially and politically. The present Covid19 could offer a scenario like new Blair House Agreement.

A non-Western Candidate is the need of the hour for WTO to save the institution and agenda. India being the world’s largest and matured democracy, a neutral country in most of the contentious global issues, an oldest civilization and having better understanding about Asia, an Indian Origin WTO Chief could revive this  institution and its agendas in a better manner. India is now geopolitically well positioned to steer WTO in a way to protect the world from negative trade impacts. Two Indians who had held Deputy Director General position are Anwarul Hoda and Harsha Vardhana Singh.  Both are either a Civil Servant or a Career Professional but not a politician. So their candidature may not be suitable at this stage. There are seasoned career politicians in India, who have the stature and qualification to strike such trade deals and create peace. Subramaniya Swamy, though aged, 81, is an apt candidate to create trade peace between the West and the East having deep knowledge, acumen and across board connections. In a distant race, the descending order candidates are Ram Madhav, Nirmala Sitharaman and Suresh Prabhu. It could be an interesting question, if Jaishankar and Hardeep Singh Puri will qualify to compete as they are civil servant turned minister? Hence, GATT and WTO never had a woman as Chief, Nirmala Sitharaman could make the second best Indian candidate. If Shashi Tharoor and Jayaram Ramesh defects from Congress and join the ruling party  BJP, they too could become distant Indian candidates. 

The major decisions relating to WTO were always played by Ministry of Commerce & Industry. The role of Ministry of External Affairs in the WTO related affairs was negligible in the past. WTO DG Selection was a non-event in India till recent past. Considering the fact that the present WTO DG Selection will have geopolitical implications, the role of Ministry of External Affairs may shadow the decision of Ministry of Commerce & Industry.  The tip of an iceberg could be felt by the closure of RCEP negotiations.  It is also need of the hour that the trade is to be seen through geopolitical lens. The tenure of current Indian Permanent Representative for WTO J.S.Deepak ends on 31^st May 2020.  If India wishes to place its candidate in WTO Chief selection, it requires to appoint a competent campaign manager as the Indian Permanent Representative for WTO to gear up for the WTO DG race.  Going for WTO DG race could be a test case for India to learn experiences to shoulder responsibilities in the multilateral forums.

Prime Minister Modi being a globally respected and reputed leader among his counterparts, the candidate promoted by India would receive more supports with weak or limited opposition in the initial period of campaign. The Indian candidate for WTO Chief will represent globalization with Bharatiya and Asian characteristics in addition to alternative methodology, objective and vision. An Indian candidate at this moment could bring the climate of peace and prosperity for the West as well as the East.