Trade amidst declining Trust: The Consequences for Multilateral Governance
The World Trade Organisation (WTO) came into being on 1 January 1995. It is the embodiment of a remarkable international development. The architecture of the WTO system confers a single package of rights and obligations upon Members in a multilateral rules-based trade arrangement with compulsory dispute settlement. This system brought major benefits but now faces serious challenges.
The WTO was born at a time of global optimism. The world of 2020 is a very different place. Not only have the values and institutions of liberal democracy not spread as widely as Fukuyama (1992) predicted, but rivalry and a lack of trust now threaten the consensus required for governing an increasingly interdependent and complex world. We are, in the words of The Economist, living in “an age of mistrust”.
This Working Paper discusses some of the challenges presently confronting multilateral trade governance. We make the case for multilateralism but recognise the need for reform, adjustment and expansion. Arrangements such as the WTO continue to offer invaluable and necessary international frameworks. The WTO may, in fact, be indispensable as a forum of engagement and the pursuit of solutions to existing and new trade-related challenges.
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