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                                                                                          Updated April 22, 2020

WTO: Ministerial Delay, COVID-19, and Ongoing Issues


Due to the coronavirus pandemic (COVID-19), the World
Trade Organization (WTO) canceled its 12th Ministerial
Conference (MC12) planned for June 2020. The biennial
meeting, which usually involves active U.S. participation,
was widely anticipated as an action-forcing event for the
WTO, amid serious challenges facing the multilateral
trading system. Some members hoped key results for
ongoing negotiations could help preserve the WTO's
relevance. In addition, a dispute settlement (DS) crisis
continues, with the Appellate Body ceasing to operate in
December 2019 and no consensus on solutions. Broader
reforms of the institution also remain under active
discussion, including some U.S. proposals. While MC12
and other meetings were suspended, members are
attempting to continue some WTO operations virtually.

The WTO can play a unique role in coordinating global
trade responses, which could be critical in mitigating the
grim global economic and trade outlook in the wake of
COVID-19. The WTO has committed to work with other
international organizations to minimize disruptions to cross-
border trade and global supply chains-in particular those
central to combatting the virus-while safeguarding public
health concerns. It has sought to inform members of the
impacts on trade and encouraged them to notify the WTO
of any trade-related measures taken in response to COVID-
19. The number of countries implementing trade
restrictions, including curbs on exports, has increased
significantly since the beginning of 2020, raising debate
among analysts about the economic and policy rationales
and impacts, plus questions about consistency with WTO
rules. At the same time, other countries have committed to
trade openness.

Members of Congress have expressed support for ongoing
WTO reform efforts (see H.Res. 746), sought clarification
on the Administration's positions, and proposed trade-
related legislation in response to COVID-19.

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After the declaration of COVID-19 as a pandemic,
Kazakhstan, the host for the WTO's MC12, cancelled the
planned June meetings. Following mixed results coming out
of the last ministerial in 2017, the United States and other
WTO members had hoped MC 12 would mark a turning
point to conclude some negotiations. They also hoped to
announce significant progress on multiple initiatives,
demonstrating the value of the WTO. MC12 was to serve as
a critical forum for taking stock of various WTO reform
proposals (see below). A new date for MC12 has not been
set, but will likely occur in 2021. Some negotiations and
other WTO activities continue in writing and virtually.
Members are currently evaluating how those negotiations
should proceed and whether these formats can be used to
yield binding decisions.


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Fisheries. Members had committed to finish negotiations
on fisheries subsidies at MC12, an achievement many view
as critical to upholding the WTO's legitimacy. Primarily
seeking to limit subsidies that contribute to overcapacity
and overfishing, negotiations continue in written exchanges,
and the negotiations chair is working to bridge differences.
The U.S. has supported equal obligations across members,
with minimal flexibilities for developing countries.
E-commerce. Members had extended the moratorium on
customs duties on electronic transmissions until MC12, but
it is unclear if the extension will be sustained, given the
opposition of some developing countries. Separately, the
United States and over 75 members are actively negotiating
a plurilateral initiative on e-commerce. The United States
seeks an ambitious, high standard digital trade agreement.
The parties had hoped to publish a consolidated text at
MC12 to gain momentum and attract new participants.
Agriculture. Some observers warned that MC 12 would be
deemed a failure without some agreement on agricultural
issues. Talks have stalled in recent years, but members
continue to exchange views in writing on issues, including
public stockholding and special safeguard mechanisms for
developing countries. Given renewed attention to lack of
compliance with WTO notification requirements (e.g., on
domestic support and export subsidies), some experts saw a
transparency agreement as a feasible outcome for MC 12.
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In the wake of COVID-19, the WTO Director-General
emphasized, Maintaining open trade and investment flows
will be critical to protect jobs, prevent supply chain
breakdown, and ensure that vital products do not become
unaffordable for consumers. In early April, the WTO
issued its trade forecast, estimating a plunge in global trade
in 2020, ranging from 13% to 32%. A recovery is expected
in 2021, but the extent depends on the duration of the
pandemic and countries' policy choices. For the latter, the
WTO has emphasized the importance of transparency.


Several WTO agreements are relevant to health-related
policies, such as technical barriers to trade, sanitary and
phytosanitary measures, services, and intellectual property
rights. Others guide implementation of policies, including
through the WTO's fundamental principle of
nondiscrimination, as well as rules on subsidies. Specific
commitments have contributed to liberalization of trade in
medical products: (1) tariff negotiations during the Uruguay
Round; (2) a plurilateral Agreement on Pharmaceutical
Products, updated in 2011; and (3) the expanded plurilateral
Information Technology Agreement in 2015.

WTO negotiations and agreements have improved market
access for medical products, but barriers remain. An April


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