A New WTO Leader: Will It Matter for Development?

January 23, 2013

While the World Trade Organization is not normally seen as a development organization, a strong, rules-based trade system is still critically important for developing countries, and the WTO is at the center of that system. Later this year, the organization will select a new leader to succeed Pascal Lamy and the expectation is that the person will be from a developing country. Unlike the World Bank and the International Monetary Fund, where a “gentlemen’s agreement” reserves the former for an American and the latter for a European, the WTO leadership is open to all and the members each have one, equally-weighted vote, though decisions are typically by consensus.Here are the eight directors-general of the WTO and its predecessor, the General Agreement on Tariffs Trade (GATT) to date:All but two have been from Europe, only one was from a developing country—Supachai Panitchpakdi from Thailand—and he had to split his term with the only other non-European to date, Mike Moore from New Zealand, because members could not reach on consensus on one or the other.This year’s field looks quite different.One thing we know is that the new director-general (DG) will not be from Europe and there is a one in three chance that he will be a she. The candidates this time are from Brazil, Costa Rica, Ghana, Indonesia, Kenya, Jordan, Mexico, New Zealand, and South Korea.What matters most, as with last year’s transition at the World Bank, is that the process should be “open, transparent and merit-based.” Politics will no doubt play a role in achieving a consensus among members, but at least the process should be relatively more open and transparent. On January 29, all nine candidates will present themselves to the WTO’s General Council and the statements should be publicly available soon after. At that point, we will hopefully have an idea of each candidate’s vision for the future of the WTO.If the process is similar to that in 2005, when Mr. Lamy was selected, each candidate will spend the next two months trying to persuade member governments that he or she is the best person for the job and then a consultation process will begin, led by the chair of the General Council. At successive stages, the chair will try to determine which candidates have too little support to gain a consensus, those candidates will be expected to withdraw and the next round of consultations will begin. A final decision must be reached by the end of May. Transparency will depend on the chair’s reports on these consultations being posted on the WTO website as soon as possible at each stage. (As a modest contribution to the process, we at CGD have written to the candidates inviting them to be interviewed on the CGD Global Prosperity Wonkcast. The first interview will be posted soon.)Of course, the WTO must work well for all its members if it is going to remain relevant and strong. But a vibrant rules-based trade system, like the rule of law within countries, only really works when it protects the weakest of its members. Achieving that does not necessarily mean that the next DG must be from a developing country. But seeing such diversity and having an open process is certainly a welcome change, even it means we have a bit of a slugfest.


CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.