Australia urges US to end WTO ‘blocking stance’
The Albanese government has called on Washington to end its ‘blocking stance’ in the World Trade Organisation’s dispute settlement body.
The Australian government has called on Washington to end its “blocking stance” in the World Trade Organisation’s dispute settlement body, which began in the Trump presidency and continues to harm “the international rules-based trading order”.
In a keynote speech in South Korea, Assistant Minister for Competition, Charities and Treasury Andrew Leigh will express frustration that the Biden administration has not fixed the American-made logjam at the heart of the global trading system.
“This blocking stance, which began under the Trump administration, has been harmful to the international rules-based trading order,” Dr Leigh will say in a speech to be delivered on Tuesday in Seoul. “A fully functioning WTO, an effective dispute settlement body and a new global trade deal are all in the interests of medium-sized economies such as Australia and South Korea.” Dr Leigh, an economics professor at the Australian National University before entering parliament in 2010, will represent Australia at a series of meetings for the Asian Development Bank to be held in South Korea.
In an interview before flying to Seoul, the Assistant Treasurer welcomed a recent speech by US Treasury secretary Janet Yellen on American relations with China. “I was heartened by her emphasis on the value of the economic relationship and the huge costs to the world of fully severing economic ties between the US and China,” Dr Leigh told The Australian.
“The philosophy of the Albanese government has been that we need to maintain that strong economic relationship — agreeing where we can, disagreeing where we must.”
Started the day with a Seoul-searching run, guided by our terrific embassy staff #auspol@AusAmbROKpic.twitter.com/vTESC5OKFD
— Andrew Leigh (@ALeighMP) May 1, 2023
South Korea, like fellow US allies Australia, Japan and The Philippines, continues to increase its security ties with Washington as China and North Korea increase their military capabilities.
But there is widespread exasperation with the American position on the WTO in South Korea, Australia’s third-largest export market. In an interview with The Australian in November, South Korea Trade Minister Dukgeun Ahn said Seoul was working with Canberra on improving the international trade umpire.
Dr Ahn, a professor in international trade law before joining the Yoon administration, said trade-focused countries like Australia and Korea were feeling pressure because of policy settings in Beijing, Washington and Brussels. “From the trade ministry point of view, the global trading system becomes very difficult – kind of a jungle. That’s how we live so we have to find a way to survive.”
In April, Japan said it would join the alternative trade-dispute resolution mechanism initiated by the EU after the WTO’s appellate body had “ceased functioning” because of America’s no-holds-barred stance. Australia is one of its almost 50 member countries. So is China.
“This is only a temporary solution,” Dr Leigh says in his speech, according to an advance copy. “It would be better if the US was to lift its veto on appointing new judges to the appeal court so that trade disputes could again be settled through the WTO Dispute Settlement Body.”
The Biden administration has said it was aiming to get the hobbled trade dispute system reformed and “fully functioning” by the end of 2024.
In his speech, Dr Leigh says South Korea and Australia are strong voices for engagement in a world of surging isolationism.
“Right now, engagement needs all the friends it can get. The pandemic was good for isolationists and xenophobes, and bad for globalisers and internationalists.
“That’s dangerous because openness doesn’t just deliver faster economic growth. International engagement can also help alleviate poverty and extend the buying power of low-income families.
“By doing so, we can continue to lift domestic living standards while bolstering our economic resilience and, as Australia’s Foreign Minister Penny Wong says, ‘strengthening our ability to exercise agency, contribute to regional balancing, and decide our own destinies.”
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