It is economic déjà vu for Zimbabwe as the central bank battles spiralling inflation. The Reserve Bank of Zimbabwe is attempting to introduce ever-higher denomination notes; but inflation still approaches 400%.
Ngozi Okonjo-Iweala: “If we didn’t have the WTO we would have to invent it.”
Nigeria's redoubtable former minister of finance, a former managing director at the World Bank, is pushing for the top job at the World Trade Organisation. She promises proactive leadership for a body that has lost its way in recent years.
In front of the lights and cameras of the formal candidate presentation and press conference on 15 July at the World Trade Organisation (WTO) in Geneva, Okonjo-Iweala delivered a robust defence of the merits of the multi-lateral trading system.
Asked why Africa did not rally behind a single candidate, she denied that there is a sense of continental division: “I am proud of my continent for providing three good candidates, and it is up to the council to choose”.
She does believe however that the WTO has a role to play in helping countries, often in the South, often in Africa, who have failed to benefit from the global trading system as it is structured today. Okonjo-Iweala said were she to be elected she would push for instruments such as aid for trade, or other mechanisms to help level the playing field.
One policy proposal African countries might appreciate from Okonjo-Iweala – especially given fresh reports of Chinese fishing trawlers plundering West African fish stocks – is the attempt to take swift action at the WTO over what Okonjo-Iweala calls ‘bad subsidies that encourage overfishing’.
The Africa Report spoke to Okonjo-Iweala via video conference on 10 July.
TAR: Multilateralism is in retreat, doesn’t that make the WTO an irrelevant organisation?
Ngozi Okonjo-Iweala: Multi-lateralism has never been needed more than now. The COVID-19 pandemic has really shown it is needed because there are simply some things world that bilateral or even sub-regional solutions cannot solve.
The same applies to trade. A multilateral trading system is one that can produce results for all, win-win solutions. And the WTO is squarely at the centre of that.
More countries, including in Africa, are pressing ahead with bilateral deals. Aren’t they losing interest in complex multilateral deals?
I think everyone recognizes a multilateral deals are cost efficient and effective, they deliver benefits for many more actors. That’s why the world devised a multilateral trading system in the first place and put an organization in place to make it work.
Does African Continental Free Trade Area (ACFTA), to be launched next year, comply with WTO rules?
Internal Africa trade is just 15% and Africa’s external trade has fallen from 5% to 3% in recent years. In fact it’s been stagnating around 3%. So whatever can be done multilaterally to increase that trade and to increase the intra-Africa trade would be a good thing. I think that the negotiations of the ACFTA have been done in a way as to be complimentary to WTO, so that WTO can help the continent do better.
We have to think of things like aid for trade. To what extent can some of the institution building that is required, help Africa take advantage of the multilateral trade system? What does Africa need to do behind its own borders to trade more with the world? It will have to produce more, it will have to process its own raw materials.
The pandemic has prompted more distrust of global supply chains and a shift back to local production. How should the WTO deal with that?
This is one of the most important questions. We will surely have more pandemics and epidemics and how we deal with them with respect to world trade will be important.
On WTO rules, to some extent, countries can decide on export restrictions, provided it’s temporary, transparent and proportionate and notified, and that they remove it in the end. So we should make sure that this does not become a reason to block trade.
There are countries that are completely food import dependent. In a situation where some countries don’t have the economies of scale to manufacture either food or medical supplies …. we should have a world trading system that allows them to have access. That does not mean that for other countries who want to take measures to improve manufacturing behind borders of any kind, it shouldn’t stop any country or putting more manufacturing in.
How do trade rules affect public goods such as vaccines and pharmaceuticals?
As the chair of GAVI (Global Alliance for Vaccines and Immunisation), I’m seeing it from the front lines – we want to make sure we don’t have a situation where access to vaccines for countries where they are not made is blocked.
The world is so interconnected now that no one is safe until everyone is safe.
This is an area where we need to think through the trade regime and the rules that govern these kinds of products, whilst respecting countries desire for security.
Are you confident there will be affordable and universal access to a coronavirus vaccine?
We are working with other organizations, CEPI, (Coalition for epidemic preparedness innovation) and WHO (World Health Organisation) to accelerate the discovery and distribution of vaccines of therapeutics and diagnostics. It’s progressing well. The idea is to get a coalition of countries that would be able to band together and purchase these vaccines in a way that they will be available and distributed to rich and poor countries alike at the same time, so that no country needs to wait.
I can tell you some good news, there’s an instrument we developed, called the advanced market commitment which several countries have supported to sign an MOU with AstraZeneca and the Oxford group, for 300 million doses of vaccines, which will go to low and middle income countries – if approved and certified by WHO as the right quality say for everyone to use.
Why hasn’t the WTO concluded a single trade negotiation round of global trade talks since 1995?
In terms of a major round, the Doha Round has never been concluded and no other major round has been launched. Over time there’s been a growing divide among countries and a lack of trust, not seeing things from the same point of view. But as you look at it, this is not overwhelming. I feel that there’s still room to rebuild that trust, to try and build that consensus and to come to agreements.
That’s why the WTO needs now a director-general that can work with the members to move forward some critical pieces. The fisheries negotiation, for instance, could be concluded and could be a very important one from several viewpoints.
It would deal with overfishing, with depletion of fish stocks which is a threat to biodiversity, by getting rid of destructive subsidies that don’t help. And it can also support small-scale fisheries in developing countries.
Given we’re in the midst of a global trade war, some say running the WTO is the job from hell. Why do you want it?
First, I’m really passionate about trade. Trade is not an end in itself, it’s a means to an end.
We’ve seen it as an instrument that helps deliver development and if properly managed, those who have been marginalized can be brought in. Women and small and medium enterprises can be brought in – those are things that WTO should be looking at.
Given the current schisms, how would you get agreement among the WTO members?
I see the ability for developing countries, especially the least developed countries, to benefit, whilst not taking away from developed countries. This is why trade is so interesting, is that you can actually have win-win outcomes for the participants and not a zero-sum game.
To get to these issues, you need an honest broker, an objective head, someone with the right skills, someone who knows the subject but with strong political and negotiating skills, the managerial skills to move things and also be someone who can listen well, who is very solutions–oriented.
One very critical issue is going back to the fundamental principles on which trade was founded. This multilateral trade system delivered, because it was delivering for all.
The principles of stability, predictability, non-discrimination, fairness, transparency – these are all the important principles on which the WTO and the world trading system was founded. It delivered, it stopped all the trade wars and it can deliver again.
What personal qualities would you bring to the job?
To get people back to those fundamental principles, to see that sometimes when you’re involved in an issue so deep down, you need someone who can step back, bring a fresh pair of eyes and ears.
And I believe that’s what I’m going to do. That’s why I think that I can bring qualities that will help move this organization. You need energy, you need enthusiasm, you need to see opportunity where there are challenges, and that’s me.