US blocks fresh proposal to restart dispute settlement mechanism
- A proposal supported by 130 WTO members to restart the selection process for filling vacancies on the WTO's Appellate Body faces rejection from the United States.
Key Highlights
- The ongoing deadlock raises concerns about the functionality of the Appellate Body, exacerbating global trade tensions amid geopolitical challenges and protectionist trends.
Persistent U.S. Obstruction:
- The United States, for the 73rd time, blocks the proposal initiated by Guatemala to launch the selection process for Appellate Body members.
- Since 2017, the U.S. has opposed the appointment of new judges, citing concerns over judicial activism at the WTO and issues related to U.S. sovereignty.
Global Trade Impact
- The absence of a functional Appellate Body is worrisome, especially as global trade is already slowing amid growing geopolitical tensions.
- Developed countries adopting inward-looking trade measures, such as carbon taxes, further complicate the trade landscape, impacting countries like India.
WTO Ministerial Conference and Reform Efforts
- Ahead of the 13th WTO Ministerial Conference in Abu Dhabi, India aims to advocate for a resolution to the system.
Controversial US Perspective
- The U.S. asserts that the old system was not working for multiple members, emphasizing that relaunching the Appellate Body selection process does not address underlying concerns.
- The statement received surprise from some members, given the significant support for the proposal among 130 co-sponsoring countries.
Alternative Measures and U.S. Impact
- Seven members suggest exploring the multi-party interim appeal arrangement (MPIA) to maintain appeal rights in the absence of a functioning Appellate Body.
- The U.S. Trade Representative argues that the proper functioning of the Appellate Body disproportionately affects the U.S., citing a high number of disputes challenging U.S. laws.
Prelims Takeaway
- MPIA
- WTO