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America holds the World Trade Organisation hostage

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EIGHT months into Donald Trump’s presidency, the rules-based system of global trade remains intact. Threats to impose broad tariffs have come to nothing. Some ominous investigations into whether imports into America are a national-security threat are on hold. Mr Trump looks less a hard man than a boy crying wolf. All the same, supporters of the World Trade Organisation (WTO), the guardian of that rules-based system, are worried. Other dangers are lurking. There is more than one way to undermine an institution.

The WTO is meant to be a forum for reaching deals and resolving disputes. But all 164 members must agree to new rules, and agreement has largely been elusive. So if members do not like today’s rules, as interpreted by judges, they have little prospect of negotiating better ones. That puts pressure on the WTO’s judicial function, the bit that has been working fairly well.

Trouble is brewing at the WTO’s court of appeals. It is meant to have seven serving…Continue reading

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