U.S. Chamber Staff


February 19, 2020


Fill me in:

Since its establishment 25 years ago, the World Trade Organization (WTO) has served as an invaluable forum for the U.S. and other countries to eliminate trade barriers and foster growth and development worldwide.

The WTO provides critical rules for a strong international trading system and dispute settlement panels to resolve commercial disputes. The WTO agreements address trade in goods, services, intellectual property, government procurement, and other vital issues, and they have increased trade around the globe.

Why does it matter?

While the WTO’s rules are still very much in force, and dispute panels still do their work, the Trump Administration has blocked nominations to the WTO Appellate Body, leaving it without a quorum to hear appeals from panel rulings. Without an Appellate Body, U.S. companies are concerned that WTO member countries won’t fully uphold the commitments they’ve made under the WTO.

That’s not all:

The Trump Administration is also reportedly considering withdrawing from the WTO Government Procurement Agreement (GPA). The U.S. Chamber would strongly oppose such a move because the GPA is one of the most reciprocal of all U.S. trade agreements. It affords American companies a level playing field in foreign government procurement markets with a total annual spending that approaches $1 trillion.

There are no free riders in the GPA, and its membership is comprised almost entirely of close U.S. allies and free-market economies. Countries such as China or Russia, should they make a serious effort to join the GPA, are required to negotiate bilaterally with the United States before gaining admission.

Number to know:

$25 Trillion: Trade has quadrupled and the WTO has played a key role in the growth of our global economy. Upon the WTO’s implementation, trade has quadrupled from $6 trillion in 1995 to $25 trillion in 2018.

Our take:

“Safeguarding this institution and its dispute settlement system should be an urgent international priority. Let’s not shutter the WTO Appellate Body. Such drastic action doesn’t serve America’s interests.” -U.S. Chamber CEO Tom Donohue. Read his full statement.

What’s next:

The U.S. Chamber advocates for necessary reforms to be made to the WTO, as well as its Appellate Body, in the hopes of maintaining international trade and boosting America’s business community. The U.S. Chamber and many others in the business community are pushing the Administration not to withdraw from the GPA.

Protecting the legitimacy and functioning of the WTO is of urgent importance for the global business community, and it’s worth preserving as an essential vehicle to advance rules-based trade.

More Reading:

Why American Business Needs the WTO

About the authors

U.S. Chamber Staff