The Time is Right For a Leader at the WTO. Who will it be?

WTO Director General Roberto Azevedo announced his resignation on May 14. The race for the next Director General is now open. Member states have nominated eight candidates who are now competing for the job. Whoever it will be has a tremendous job on their hands. The WTO is in a deep crisis as each of its three functions is under strain: The judicial arm is blocked, no substantial negotiations have been concluded since the failure of the Doha Round, and trade controversies are increasingly tackled outside the organization, not within. The next DG will have a tough job to get the organization and, with it, the global trading system back on track. In this blog post, we look at the expectations of the trade community and the profiles of the candidates.

What does the DG do?

The Director General (DG) of the WTO is not formally a very powerful position. The WTO is a member-driven organization – their representatives make the big policy decisions. The DG essentially holds two sources of power: the leadership of the WTO’s Secretariat and is the mediator in chief in the global trading system. Previous DGs have sometimes managed to use these two functions effectively to derive a significant degree of influence and to take the WTO and the global trading system forward.

The role of the chief trade diplomat should not be underestimated. The DG is the one single person who represents the system as a whole to the public and the member states. Acting skillfully behind the scenes to build consensus and propel worthy policy initiatives can make the difference between success and failure.

In addition, leading the Secretariat gives the DG the power to use its resources strategically, e.g., through providing research on an issue where establishing facts can facilitate proper substantial discussions among member states or pointing to issues that deserve more attention from the membership.

The outgoing DG, Roberto Azevedo, is a career diplomat. Some of his predecessors have had a political career before taking up the role of DG. Different leaders have brought different styles to the organization: some have provided stronger political leadership while others preferred to keep a lower profile and act more quietly to coordinate among member states.

What Does the Trade Community Want from the Next DG?

Which profile is desired by representatives of the trade community for the next DG? Do they want a quiet coordinator or someone with more political clout? Researchers at the European University Institute have run a very interesting survey on policy preferences for the next DG (Link to blog post; link to full version.) The figure below shows which qualifications of a DG candidate were ranked high and which ones weren’t so much.

The top four qualities which are ranking high or very high are: experience in managing organizations, political experience, economic training, and experience as WTO negotiator. Other elements, such as whether a candidate comes from a developed or developing country (an unwritten rule says it should alternate between developing and developed countries), the gender (all previous DGs were men) are ranked as less important.

The survey also establishes that the trade community finds it most important that candidates are well connected in the capitals of major trading powers, with other international organizations and with international business. The value of being well-connected with the leadership of large trading powers is self-evident. Good connections with other international organizations help to coordinate policy responses, for example, to Covid19 but also in other areas of business.

Sometimes WTO member states don’t wish to take a particular issue forward in the WTO, but it is possible to do it in another international organization. The impact of agricultural subsidies on international competition was first studied by the OECD, laying the groundwork for negotiations in this area conducted in the GATT, the WTO’s predecessor.

Similarly, connections to business matter potentially a lot. Currently, business is often described as being “missing in action” when it comes to addressing the crisis of the WTO. But businesses can make a real difference in trade negotiations because they can push their governments to find solutions. This is particularly true for a trade world that is increasingly dominated by geopolitical rather than economic concerns.

Which Candidates Have the Desired Characteristics?

The deadline for member states to nominate candidates expired on July 8. The eight nominated candidates now have the opportunity to engage with the membership at large and get their support. The eight candidates are Mohammad Maziad Al-Tuwaijri (Saudi-Arabia), Liam Fox (United Kingdom), Abdel-Hamid Mamdouh (Egypt), Amina Mohamed (Kenya), Yoo Myung-hee (Republic of Korea), Ngozi Okonjo-Iweala (Nigeria), Jesus Seade Kuri (Mexico) and Tudor Ulianovschi (Moldova).

The list below tries to summarise, based on their CV, to what extent they tick the boxes of the most desired qualities for the new DG. I am not including connections to capitals, business, etc. as this would be difficult to assess based on the information available. I attribute “ticks” for the criteria as follows: experience in leading organizations, political experience of ministerial rank, economics training (holding a degree in economics), WTO negotiation experience, (either in a member state delegation in Geneva, to multilateral trade rounds or in a senior position in the WTO secretariat), legal background (holding law degree,) and public profile (having held public office). This might seem a bit tough, as all candidates have some background in all those fields, but it helps to provide a clearer picture.

The three candidates that tick the most boxes are Amina Mohamed, Yoo Myung-hee, and Tudor Ulianovschi. From the reporting on the hearings last week at the WTO, it seems that Amina Mohamed has emerged as an early front runner. As a former Kenyan Trade Minister and WTO Ambassador, she knows the system inside out. Before her nomination, we praised her handling of the Nairobi WTO Ministerial Conference as an example of how the host can contribute to the success of such a meeting (LINK).

Representing an African country is also an advantage as the African representatives are very vocal that it is time for a WTO DG to come from Africa (there never was an African DG before). Tudor Ulianovschi apparently impressed in Geneva but is believed to have too little support among the membership. Myung-hee’s performance is reported to be solid.

It is too early in the race to say who will emerge as the consensus candidate – if anyone will at all. There is the general fear that the US administration – at least as long as Trump is president – may block the appointment of a new DG.

Whoever becomes DG will have to obtain the trust of all the major players and factions in the system, which seems like squaring a circle. It is also not impossible that member states will end up (again) choosing a technocratic candidate who will focus on behind-the-scenes business rather than a strong political leader driving forward a trade agenda.

The time, however, is ripe for a leader. The WTO is in too deep a crisis for a technocratic management to fix its bugs. To repair the organization, the next DG needs to be able to secure buy-in from the top level of politics from the member states. A visionary leader with strong personal credibility is required in the role.