Can Africa’s first WTO chief help her own continent or avert US-China cold war?

Jevans Nyabiage
·4-min read

Africa is to have its first director general of the World Trade Organization, with Nigeria’s former finance minister Ngozi Okonjo-Iweala set to be confirmed as its head when members meet in the next few days. She will also make history as the first woman to lead the body.

The Nigerian’s appointment was sealed when South Korean Trade Minister Yoo Myung-hee dropped her bid for the job and the United States lifted a veto on Okonjo-Iweala that had been exercised by its former president Donald Trump.

But analysts said Okonjo-Iweala could face insurmountable challenges amid questions over the effectiveness of the 26-year-old intergovernmental body, which regulates trade between nations. The previous director general, Brazil’s Roberto Azevedo, resigned last August with a year left to run on his term, while trade tensions between the US and China remain unresolved.

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William Reinsch, a trade expert at the Centre for Strategic and International Studies in Washington, said the 66-year-old Okonjo-Iweala, a development economist, needed to reassert the organisation’s three main functions: negotiation, dispute settlement and notification of measures.

“All three are essentially failing, so she has a lot of work ahead of her,” he said.

As soon as the US backed her candidacy, Okonjo-Iweala – who was recently granted American citizenship – said on Twitter that she thanked leaders across the world and “[looked] forward to finalising the process of WTO DG”.

During her campaign for the role last year, she pledged to find common ground among the body’s disparate membership. She said the benefits of the WTO and trade “must be brought home and made real to the ordinary woman and man on the street”.

Nigerian President Muhammadu Buhari welcomed the decision of the new Biden administration in the US to remove the last obstacle to Okonjo-Iweala getting the job. An appointment panel of ambassadors had in October identified her as the best candidate, before the Trump administration vetoed her. The WTO historically selects its head by consensus.

What is the US-China trade war?

Louw Nel, a senior political analyst at NKC African Economics, a subsidiary of Oxford Economics, said the Trump administration had “often disparaged and questioned the role of the organisation, accusing it of bias in favour of China”.

Nel said the US also opposed China’s designation as a developing country, which affords it special provisions in respect of WTO agreements.

Last September, a WTO panel ruled that US tariffs on US$200 billion worth of Chinese goods were illegal. The decision led to the US openly frustrating the WTO’s processes.

Nel said WTO director generals did not wield much direct power but did perform a crucial leadership role that helped shape the direction of the organisation.

“As such, Ms Okonjo-Iweala’s appointment is seen as a boon for Africa,” he said. “It may, however, take some time before any real benefits are apparent.”

Fredrik Erixon, director at Brussels-based think tank the European Centre for International Political Economy, said the WTO had been “rendered weak” after its appellate body ceased functioning in late 2019 as a result of Washington blocking the appointment of new judges.

“A change of leadership may not change anything if there is no goodwill from major economies such as the US and China,” Erixon said, adding that the race to become director general “hasn’t been one with a lot of politically strong characters involved”.

“There used to be former heads of governments involved, but as the organisation has lost a lot of its relevance, the job of DG is seen as less important and no one thinks Okonjo-Iweala or anyone else has the capacity to move things very much.”

Raj Bhala, distinguished professor at the University of Kansas law school, said the top issues awaiting Okonjo-Iweala included restarting the appellate body and sealing a deal on fishing subsidies.

But he said the WTO was not the right forum to handle the complex mix of economic, security and political issues contributing to the onset of a new cold war between the US and China.

“The WTO cannot fix this bilateral relationship, any more than the UN could have fixed the Soviet-American relationship,” Bhala said. “The solution rests in the minds and hearts of the two principal players.”

Craig VanGrasstek, a trade historian and consultant, said Okonjo-Iweala’s authority would be limited.

“Electing someone WTO director general is like making them captain of a ship but denying them control of the engines,” VanGrasstek said. “The captain may influence the direction, but the choices are in the hands of the members.”

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