How Trump Could Deal Another Blow to Already Hobbled WTO
Donald Trump has proposed an “automatic” tariff on foreign goods, and said he liked the idea of setting the rate at 10%.
Photographer: Nathan Howard/BloombergRising protectionism and rogue trade wars have diminished the World Trade Organization’s status as the global arbiter of trade. The US played a key role in its decline — first with former President Donald Trump’s unilateral tariffs and attacks on its dispute settlement system, then with President Joe Biden’s decision to stay the course. Now, Trump the presidential candidate is pledging to impose an automatic 10% tariff on all imports from all countries if he’s elected in 2024 — an idea that some have likened to a potential death knell for the system that governs $32 trillion in annual global trade.
The WTO, based in Geneva, provides a forum to negotiate deals, settle disputes and monitor trade practices. It started life in 1995, replacing the General Agreement on Tariffs and Trade, which was developed after World War II. While the GATT regulated trade in goods and reduced tariffs and other barriers, the WTO also covers services and intellectual property. A smoothly running WTO provides businesses with the certainty they need to invest and operate abroad, and fosters growth and economic integration. Since its creation, global trade has almost quadrupled in value. Yet, in recent years the WTO rulebook has failed to address massive shifts in the global economy, such as the proliferation of digital trade.