DP11021 The World Trade Organization and the Future of Multilateralism
|Publication Date:||December 2015|
|Keyword(s):||21st century trade, GVCs, Mulilateralism, WTO|
|Programme Areas:||International Trade and Regional Economics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=11021|
This paper looks that the future of multilateralism and the WTO in the light of its current problems and past successes. The main thesis is that WTO and the future of multilateralism are two different things. The ICT Revolution created a new type of trade ? what might be called 21st century trade ? where greater integration means more ?factories crossing borders?. As a result, the flows that used happen only inside rich nation factories are now part of international commerce. These new, more complex cross-border flows go beyond, the 20th century trade that the WTO was set up to govern. For 20th century trade, the WTO and multilateralism are likely to continue even as the WTO?s centrality in global trade governance shrinks. Multilateralism for 21st century trade, however, has shifted to regional arrangements like TPP. Unless the WTO membership makes a big shift and embraces 21st century trade issues, the new mega-regional trade arrangements will act as loose governance organizations for 21st century trade. Whatever happens, it is clear that by the end of the decade, world trade governance will be quite different than it is today. The idea that the WTO is the central pillar of global trade governance will either be replaced by a multipolar system, or the WTO itself will be transformed.