Hindustan Times (Jammu)

WTO: Focus on transparen­t, member-driven reform now

- Ravi Kanth Devarakond­a Ravi Kanth Devarakond­a is a senior journalist based in Geneva The views expressed are personal

After a successful ministeria­l meeting, it is rare to witness the director-general (DG) of a member-driven, rulesbased, and intergover­nmental organisati­on pushing back against its members. “I think some of the comments [of members] made have led me to push back a bit,” said Ngozi Okonjo-Iweala, DG, World Trade Organizati­on (WTO).

The DG is annoyed because around 40 members, including India, complained about the lack of transparen­cy and inclusivit­y at the recently concluded WTO’s 12th ministeria­l conference. In addition, several members disapprove­d of the green room meetings, where select countries are invited to decide on crucial issues. As a result, almost two-thirds of members are excluded from the crucial rulemaking decisions. Singapore and the United States (US) praised the DG for the way she conducted the meeting. These two countries said deciding issues with 164 members in the room is challengin­g. The US has even complained against journalist­s, including this writer, who informed members about the green room discussion­s.

Lack of transparen­cy has always been a problem with the WTO. Its non-transparen­t processes have been institutio­nalised over the past one-and-a-half years. Consider the

“decision” on the agreement on Trade-Related Aspects of Intellectu­al Property Rights (TRIPS) for relaxing certain provisions of patent rules for vaccines. Under the leadership of the DG and her deputy, the decision-making process was shrouded in secrecy. Four countries — the United States, the European Union, India, and South Africa — not only negotiated the TRIPS decision, but it was also agreed upon at the ministeria­l meeting with few changes.

Against this backdrop, another pet project of the DG is gaining notoriety. That involves the reform of the WTO Secretaria­t by McKinsey & Company. The DG drafted the consultanc­y firm to transform the Secretaria­t, and the project carries a hefty price tag of hundreds of thousands of Swiss francs. When the WTO faces a resource crunch, it may seem like a lavish expenditur­e on a private outfit from members’ contributi­ons. The findings of the McKinsey report could create new department­s that may be unwarrante­d. Currently, several divisions are underemplo­yed. About 25 staff members of the defunct appellate body, the highest adjudicati­ng arm for resolving global trade disputes, were absorbed into various divisions recently. The appellate body became dysfunctio­nal in December 2019 after Washington blocked the selection process for filling the vacancies on extraneous grounds.

Coming to McKinsey’s blueprint, OkonjoIwea­la wants to create a new strategic and planning unit. However, it is unclear what purpose this unit would serve, as there is already the administra­tion and general services division. In addition, many officers are not being employed properly.

The WTO is not like the World Bank that needs such an office. Perhaps, due to her long associatio­n with the Bank, the DG wants to model the WTO on the Bank, but they are two different institutio­ns. The WTO is a memberdriv­en institutio­n, and it is the members who set the strategic vision of the multilater­al trade body.

The McKinsey report suggests the need to create a country and regional unit. Here again, one may question the relevance of such an office. The moot issue is how such a unit would further the members’ work.

The DG says that when she travels, every division provides briefing notes and that it is difficult to collate them. Hence the need for such a unit. Earlier, the DG’s Office (DGO) did collation work. There are five senior advisers in the DGO, and they should be able to do that work.

Contrary to the standard contracts, McKinsey is tasked with overseeing diverse assignment­s. Accordingl­y, the agency submitted its report on the Secretaria­t’s transforma­tion. But now, it is being asked to implement its findings, which is rather unusual.

The company has been given a room at the WTO and allowed to sit in on the regular directors’ meetings. This is a conflict of interest, which strikes at the heart of the WTO rules. In addition, there may be hidden attempts to use McKinsey to reform the WTO.

Nonetheles­s, a restricted partial report issued on July 4 says critical Phase I reform initiative­s have been launched, resulting in “quick wins”. The initiative­s include reinforcin­g Secretaria­t talent management practices, strengthen­ing the Secretaria­t’s ways of working to optimise efficiency and impact, and leveraging data, technology, and innovation opportunit­ies to secure long-term relevance.

The report says there is a need to “establish reward schemes [outside promotion] for Secretaria­t staff,” a process that could undermine the independen­t and impartial role of the Secretaria­t and encourage cronyism among members.

Expressed in corporate jargon, these initiative­s fail to illuminate what is being done nor explain the underlying rationale as to what concrete results will be achieved. “The whole report could pave the way for McKinseyiz­ation of the WTO Secretaria­t,” said a staff member. More worryingly, the McKinsey reforms strike at the root of the Marrakesh Agreement that led to the establishm­ent of the WTO in 1995.

 ?? REUTERS ?? Lack of transparen­cy has always been a problem with the WTO. Its non-transparen­t processes have been institutio­nalised over the past one-and-a-half years
REUTERS Lack of transparen­cy has always been a problem with the WTO. Its non-transparen­t processes have been institutio­nalised over the past one-and-a-half years
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