EU backs Chinese plan to unblock WTO arbiter

THE European Union is siding with China over plans to unblock the world’s trade arbiter, putting it on a fresh collision course with Donald Trump.

Brussels is seeking a way around stagnation at the World Trade Organisation (WTO) by teaming up with 17 other countries to form a temporary appeals body which can settle disputes.

The move is likely to infuriate the US because it interferes with White House efforts to reform global trade in the wake of what the president regards as unfair support for rivals such as China.

Mr Trump brought the WTO’S appellate body to a halt last year, effectively shutting down the supreme court of international trade by blocking all nominees to its seven-member panel of judges. The court requires three judges to open a new case, and has only one remaining. The new mechanism, announced at the World Economic Forum in Davos yesterday, puts further pressure on the international rulesbased order for trade. Backers include the EU, China and Brazil.

The UK will become an independent member of the WTO after leaving the EU. The trade organisation was established in 1995 as a forum for its 164 members to have negotiations and disputes. Phil Hogan, the EU commissioner for trade, told the EU Parliament last year: “If there isn’t an enforcement mechanism, there isn’t any point in having agreements.”

Roberto Azevêdo, director general of the WTO, said: “The dispute settlement mechanism that we have is 25 years old. It’s not surprising we are seeing people who are unhappy with the way that it developed.”