U.S. FARES WELL IN WTO DISPUTES

Trump need not bother ignoring trade body as his country has had high rate of success in arguing cases

WASHINGTON

UNITED StatesPresident Donald Trump has hinted the US is prepared to ignore rulings by the World Trade Organisation (WTO). He may not have to bother, because America’s lawyers often win anyway.

The US has a better-than-average rate of success in arguing cases at the WTO, according to a Bloomberg analysis of the 524 cases lodged at the Genevabased organisation since it was founded in 1995.

“On balance, it’s been a pretty good system for the US,” said Gary Hufbauer, a senior fellow and trade expert at the Peterson Institute of International Economics, here.

“The US has gotten other countries to change their practices, where it would have been much harder through the old ways of diplomatic negotiations or unilateral retaliations.”

Trump has blamed competition from China and trade deals such as the North American Free Trade Agreement for costing American jobs and hollowing out its manufacturing sector.

As a candidate, he threatened to pull the US out of the WTO, which grew out of the system of global trade rules that countries developed after the Second World War.

In a recent outline of its trade agenda, the US government noted that the country isn’t bound by decisions made at the WTO.

“The Trump administration will aggressively defend American sovereignty over matters of trade policy,” said a report by the Office of the US Trade Representative.

When the US has complained against the trade practices of other countries, it won 86 per cent of the time, slightly better than the WTO average, Bloomberg data shows.

For WTO cases filed against the US, it lost less often than the average — about 75 per cent of the time compared with more than 84 per cent for all nations.

Governments that believe other countries have violated international trade rules can bring complaints to the WTO, which establishes panels of three to five experts to hear the evidence.

Hufbauer said complainants usually win because countries try to file complaints they know they have a good chance of winning.

America’s success rate is probably due to a number of factors, including the relative fairness of the country’s trade practices and the skill of US government trade lawyers, he said. Bloomberg