WTO set to pick new leader, amid talks deadlock

GENEVA – The World Trade Organization is close to choosing its next leader in a final round pitting Brazil against Mexico, with the winner facing the tough task of restoring the clout of global commerce’s rule-setting body.

Brazil’s WTO Ambassador Roberto Azevedo and his rival Herminio Blanco, Mexico’s former trade minister, are expected to learn as early as Tuesday whether they have won a contest that is seen as too close to call.

All concerned are keenly aware that the successor to two-term Director General Pascal Lamy from France must act fast to revive the WTO’s moribund global trade talks.

Both men have pitched a similar vision for a negotiating process which they say needs overhauling.

“The multilateral trading system is weakened by a complete paralysis in the negotiations,” Azevedo told AFP, explaining it was time to “unclog the system.”

Blanco, meanwhile, said it was time to reboot the 159-nation WTO.

“The main challenge is the ‘W’ in ‘WTO’,” he told AFP, underlining that the logjam had pushed members into negotiating bilateral and regional deals.

“You have to transfer this energy back to Geneva,” where the WTO is based, to prove the point and reach of the organization, he said.

Supporters of a WTO-wide deal warn that other accords can create a “spaghetti bowl” of conflicting rules, thereby failing to serve global commerce.

Created in 1995, the WTO aims to spur growth by opening markets and removing trade barriers, including subsidies, excessive taxes and regulations.

The stated goal of its “Doha Round”, launched at a summit in Qatar in 2001, is to deploy trade to develop poorer economies.

But members repeatedly have clashed over the give and take needed to reach a deal, with deep splits notably between China, the European Union, India and the United States.

Some have blamed Lamy, a former EU trade chief, who raised hackles with an alleged name-and-shame drive to break the deadlock after he won a second term in 2009.

Amid fears that December’s WTO summit in Bali could fail, the new director general will have to act fast after taking over on Sept. 1.

“The new DG obviously will come in at a rather precarious time for the WTO,” said Sergio Marchi, Canada’s former trade minister and ex-WTO ambassador.

Besides working the diplomatic circuit, Marchi told AFP, the new leader must repair ties with the business community – the hub of global commerce.

“The business community has taken the view, ‘Call me when you’re serious.’ … Obviously getting Doha together is a challenge, but if the institution is seen as irrelevant, it is irrelevant,” he said.

“You don’t have to have an agreement in your first six months, but there’s got to be movement and momentum,” he added.

Against that background, Blanco seems to have the advantage.

The 62-year-old economist was Mexico’s negotiator for the 1994 North American Free Trade Agreement and has solid private sector credentials, running an international trade consultancy and sitting on US, Asia and European company boards.

“My candidacy is a package of skills, experience, ambition and creativity,” he said.

But Azevedo’s insider status could be key.

The 55-year-old career diplomat was Brazil’s chief litigator in a raft of WTO disputes before becoming ambassador in 2008.

“In the WTO today, you don’t have any low-hanging fruit. You have to go up the tree, grab the fruit and bring it down. And if you don’t know the system, and don’t know the trees, you’re not going to get the fruit,” he said.

Marchi underlined the symbolism of a Latin American WTO leader.

“It’s the emerging economies that are now the economic locomotive globally, and both Brazil and Mexico have done tremendously well thanks to trade,” he said.

The WTO’s leader is not formally elected, but picked by consensus, with senior diplomats sounding out the member states to see who has most support.

The rules were set after an ugly 1999 race which led to New Zealand and Thailand splitting the job, before Lamy won in 2005.

The WTO’s two previous chiefs were Irish and Italian, and with France following Thailand, developing nations have been keen to claim the top post.

An unprecedented nine candidates ran this time around.

Those who fell at the first fence in mid-April were from Kenya, Ghana, Jordan and Costa Rica, while Indonesia, South Korea and New Zealand stumbled at the end of the month.

Both Azevedo and Blanco underline their broad support from rich, emerging and poor nations.

But a range of diplomats told AFP they were unhappy with a final choice between two Latin Americans, while Kenya and South Korea raised concerns at WTO meetings.

Kenya’s WTO ambassador Anthony Andanje told AFP, however, that it was a matter of making the disquiet known, rather than aiming to block the process.