Unfinished business at the WTO
The WTO faces mounting challenges, from protectionism to disputes over reform. As Director-General Ngozi Okonjo-Iweala seeks a second term, her leadership faces both praise and scrutiny, aiming to uphold the organisation’s relevance amid growing global trade tensions

Governing the World Trade Organisation (WTO) is not a job for the faint-hearted. Each of the past six WTO director generals has a story to tell, which often is not pleasant. When he opted to walk away before the end of his second term, Brazil’s Roberto Azevêdo, who led the organisation from 2013 to 2020, had a difficult time trying to explain his decision. Few bought his explanation that centred on allowing the WTO General Council ample time and clarity in selecting his successor. To most, he caved in due to extreme pressure, particularly from the US. Under then President Donald Trump, the US had done a good job in amplifying assertions that the WTO was an irrelevant body.
Today, the clouds are yet again gathering and Ngozi Okonjo-Iweala, current and seventh WTO Director-General, is not sitting pretty. To observers, Okonjo-Iweala has enjoyed a rather smooth time in office since taking over the leadership of the multilateral trading system in March 2021. Though she has presided over a period with less noise and fewer attacks directed at the WTO, on achievements the jury is still out. “She has done her best in a very difficult political context,” Victor Crochet, a senior associate at the Belgium-based law firm Van Bael & Bellis told World Finance. Having made history by becoming the first female and first African to head the global trade watchdog, Okonjo-Iweala’s first term is set to come to an end on August 31, 2025. The Africa Group, one of the five United Nations regional groups, has already fronted her for a second term. She has obliged, stating she still has “unfinished business.” Among them is overseeing the operationalisation of an agreement on ending fisheries subsidies, achieving a breakthrough in global agriculture negotiations, reforming the WTO’s struggling dispute settlements system and decarbonising trade. “For my second term, I intend to focus on delivering,” Okonjo-Iweala told Reuters in September.
A decorated CV
In seeking a second term, Okonjo-Iweala has the head start of incumbency. Also, a competitor is yet to emerge. During a WTO General Council meeting in July, 58 members encompassing the 44 African Group voiced their willingness to support her reappointment and sought for the expediting of the selection process.
Many have praised her down-to-earth demeanour, hard work and achievements during her first term. If no member objects and no other candidate emerges, she could secure a second term by the end of the year.
Apart from incumbency, the Nigerian economist, who in 2019 also took out US citizenship, boasts of a decorated and rich curriculum vitae. She is also a trailblazer on many fronts. When she turned 70 in June this year, many could not fail to admire her inspiring journey that started in the dusty village of Ogwashi-Uku in Delta State, Nigeria and which was greatly shaped by her academic parents’ value for education. Both had PhDs, her father’s being in economics. Years later, she would follow the same path. “I was taught that education is a privilege, not a right. And education is not for you to enrich yourself, but to see how you can enrich others,” she told David de Ferranti, author of Reformers in International Development: Five Remarkable Lives, a book that traces Okonjo-Iweala’s life and career from childhood to the present day.
Strong belief in the transformative power of education saw Okonjo-Iweala traverse the corridors of Ivy League universities in the US like a colossus. She holds a bachelor’s in economics (magna cum laude) from Harvard University and a doctoral degree in regional economics and development from the Massachusetts Institute of Technology (MIT). For the mother of four who tightly holds to the virtue of humility, the plenitude of accolades is awe-inspiring. She is the recipient of 21 honorary degrees, has been listed in Forbes Top 100 Most Powerful Women in the World for seven consecutive years, twice named by TIME as one of the Top 100 Most Influential People in the World and once by the Financial Times as one of the 25 most influential women.
Okonjo-Iweala can take pride in a long career serving a retinue of companies and organisations. However, her long tenure at the World Bank and in public service in Nigeria stands out in adequately preparing and equipping her for the WTO top job. At the World Bank, where she spent 25 years as a development economist rising to the number two position of managing director, operations, her achievements remain remarkable. Part of them included spearheading several initiatives to assist low-income countries, managing to mobilise $50bn in grants and low interest credit in 2010.
In Nigeria, serving two times as finance minister under presidents Olusegun Obasanjo (2003–06) and Goodluck Jonathan (2011–15) are among the brightest feathers in her illustrious career. As the first woman to hold the position, her unwavering determination to clean the country’s rotten macroeconomic sphere was heroic. Among her greatest achievements was leading a team that negotiated for the wiping out of $30bn of external debt, including the outright cancellation of a whopping $18bn.
Streamlining the management of public coffers by enhanced transparency and fighting corruption was another key accomplishment. Part of the cleaning involved dismantling oil cartels that were siphoning money through dubious oil accounts. Okonjo-Iweala told de Ferranti that while auditing $11bn of oil accounts, it emerged that $2.5bn was fraudulent. The government refused to pay and the cartels did not take it kindly. They kidnapped her 83-year old mother, a medical doctor and retired professor of sociology. “That was a very challenging moment because to think you will be the agent of your parent’s demise, it is a very tough thing to bear,” she recounted.
Second term landmines
The chilling ordeal of her mother’s kidnapping is long past. Yet, the renowned development economist is facing a tribulation of a different kind – securing another term at the helm of the WTO. It goes without saying that the main reason the African Group had been pushing for an early start to the selection process was the US elections. With Trump back on centre stage there is consternation that history is about to repeat itself. During his first term in office, Trump’s administration tried to block Okonjo-Iweala’s appointment. And on the campaign trail, that concluded with his success, the Republican Party candidate had not changed his loathing for the WTO, an organisation that he has repeatedly termed as “horrible” and whose rules he openly disregarded as president with unilateral tariffs and attacks on its dispute settlement system.
Under the Joe Biden administration, the WTO has repeatedly been at loggerheads with the US largely due to the dispute settlements system. Based on the fact that it loses disputes too often, the US has continuously blocked the filling of vacancies of the WTO’s Appellate Body, the highest adjudicating organ under the watchdog’s enforcement function.
“The WTO is not apt at finding political consensus and solutions to tricky situations. It is much better at technical issues,” Crochet tells World Finance. He adds that with current political and economic tensions, it is unlikely that an agreement on reforming the dispute settlements system could be achieved without an overhaul of the substantive rules themselves. In essence, the standoff is bound to be prolonged indefinitely, to the chagrin of a majority of members. The ripple effect is not just a loss of confidence but gives credence to critics who hold the global body is gravitating towards losing irrelevance.
Relevance is a word that continues to hover uncomfortably on the WTO. Okonjo-Iweala knows this all too well. In February this year, during the WTO 13th Ministerial Conference (MC13), she admitted that the global body will always have its “naysayers and detractors.” For that reason, only success can change the tone about the WTO, both within and without. “We need to show the world that not only does the WTO underpin over three-quarters of global goods trade, it is also a forum where members deliver new benefits for people through trade,” she noted.
Though WTO’s relevance remains under constant scrutiny, the importance of the multilateral organisation in maintaining a semblance of order in global trade cannot be gainsaid. Indeed, in a world where rising protectionism, rogue trade wars and predatory practices are on the rise, the WTO remains the most impartial adjudicator. This arises from the fact that it represents 166 member countries that account for more than 98 percent of global trade valued at $32trn annually. To put it in context, it means that about $86bn of goods crosses borders every day.
At its base in Geneva, Switzerland, the global body provides a forum for members to negotiate trade agreements, enforce a network of existing treaties, settle disputes and monitor trade practices. The original and most prominent, the General Agreement on Tariffs and Trade (GATT), was negotiated after World War II based on a US proposal for an international organisation that would negotiate and enforce trade law. The successor of GATT, WTO came into force in 1995 alongside the dispute settlement system. While the GATT regulated trade in goods and reduced tariffs and other barriers, the WTO also covers services and intellectual property.
Basket of achievements
Though the jury is still out on Okonjo-Iweala’s achievements so far, the overriding consensus is that the celebrated author of several books and champion of women’s empowerment has done a relatively good job under excruciating circumstances. During her tenure, the global trade environment has faced unprecedented challenges the ripple effects of which have meant the WTO cannot vacate its position of constantly being at a crossroads. When she took office, global trade was just starting to show signs of recovering from the Covid-19 pandemic. At the peak of the pandemic in 2020, trade plunged by about $2.5trn, a nine percent decline compared with the level in 2019. Recovery has been swift and this year global goods trade is projected to post a 2.7 percent increase.
Apart from leading the WTO at a time of recovery from the pandemic, Okonjo-Iweala’s tenure has also been characterised by disruptions of global trade by geopolitical mayhem. The Russian invasion of Ukraine, the worsening crisis in the Middle East, fears that China is planning to invade Taiwan, and the war in Sudan among others means that global trade continues to be impacted by disruptions that are beyond the WTO’s control.
We need to show the world that not only does the WTO underpin over three-quarters of global goods trade, it is also a forum where members deliver new benefits for people through trade
For the WTO, its purview of control is ensuring order in the global liberal trading system. Though created specifically to facilitate the flourish of private companies, the system’s seamless nature has been disjointed due to the invasion of state-owned enterprises, with China as the antagonising factor. Owing to this fact, it has been a tough period for Okonjo-Iweala in trying to ensure all countries remain committed to the idea of open markets and trade integration.
While countries like China, India, Bangladesh, Vietnam, Mexico, South Africa and many others have open markets to thank for significantly contributing to their socio-economic transformation, the bug of protectionism is today spreading fast. Okonjo-Iweala reckons that protectionism, which largely undermines WTO rules, can only lead to fragmentation. “We are concerned about the emerging fragmentation that we see in the trade data. We are seeing that trade between like-minded blocks is growing faster than trade across such blocks,” she told the BBC earlier this year.
Inability to contain the spread of protectionism, coupled by concerns that the WTO rulebook has lost its powers in a changing trade environment that has also seen the proliferation of digital trade, has many questioning whether the WTO is still the global trade sheriff. Besides, many wonder whether the global club still has the wherewithal to spearhead predictable, stable, free, fair and open trade.
WTO has watched helplessly as the US and the European Union (EU) slap China’s electric vehicles with 100 percent and 38 percent tariffs, respectively. On its part, the EU cited “unfair subsidisation” in China that “is causing a threat of economic injury” to EU electric car makers for its decision. China, meanwhile, has retaliated by launching an anti-dumping investigation into EU pork imports. Obviously, the investigation is a ploy that is bound to end in new tariffs.
Weihuan Zhou, Associate Professor at the University of New South Wales in Australia, tells World Finance that under the current structure, Okonjo-Iweala needs to be commended for ensuring the WTO maintains some sense of grip in shaping global trade. “She has done a fantastic job in maintaining the effective functioning and leading role of the WTO in addressing a raft of challenges during and after the Covid-19 pandemic,” he observes.
He adds that one of Okonjo-Iweala’s most creative contributions has been reshaping the thinking of the global trading system to one of ‘re-globalisation,’ which counteracts longstanding criticisms of globalisation and the rising trend of de-globalisation. The new thinking has been instrumental in the success of key negotiations. Most notable was the reaching of an agreement on fisheries subsidies in June 2022.
Described as a historic achievement, the agreement was a win for ocean sustainability. By prohibiting harmful fisheries subsidies, it is expected to protect the world’s fish stocks from depletion. A total of 86 WTO members have formally accepted the agreement that requires two-thirds of members to consent to be operational.
Under Okonjo-Iweala, substantive progress has also been achieved on e-commerce talks. Having been initiated in 2017 and formal negotiations commencing five years ago, by July this year a total of 91 nations participating in the talks had managed to achieve a stabilised text.
Once completed, the e-commerce agreement will be the basis for global rules on digital trade. Apart from benefiting consumers and businesses, especially macro, medium and small enterprises, it is expected to play a pivotal role in supporting global digital transformation.
Talks on the investment facilitation for development (IFD) agreement have also made progress. A substantive pact could significantly push foreign direct investments, particularly among emerging and developing nations. This is because it has the potential to improve the investment and business climate, thus making it easier for investors not only to invest but also to conduct day-to-day activities and expand operations with no obstacles. The fact that in June 2022 Okonjo-Iweala was able to facilitate an agreement on Trade-Related Aspects of Intellectual Property Rights, allowing countries to suspend patent protections on Covid-19 vaccines thus boosting production in developing nations, increases confidence that a deal on IFD could be reached sooner than later.
Falling short where it matters
Okonjo-Iweala has reasons to feel elated for her achievements so far. However, two critical areas stain her otherwise stellar record. Granted, manoeuvring the gridlock on agriculture talks and dispute settlements reforms has proved difficult. Having inherited the murky swamp, Okonjo-Iweala risks joining a long list of WTO bosses who come and go without a breakthrough in agriculture.
In October, her frustrations were conspicuous. Following a meeting of the Trade Negotiations Committee on agriculture, the most she could say was that she detected a “meeting of minds.” In essence, although there is a ray of light, the tunnel remains agonisingly long despite the world grappling with over $640bn in trade-distorting agricultural subsidies that shouldn’t be there. “I sense that there is a willingness to try to break the gridlock on agriculture and to try and move the process forward,” she noted.
The same misfortune shrouds dispute settlement reforms. Though Okonjo-Iweala continues to advance the idea that the reform of the system is a “collective desire of every member,” the US does not agree. In 2022, MC12 set a target of end of this year to have a fully and well-functioning system. This was reaffirmed by MC13 earlier this year. With mere weeks before year’s end, the target is proving to be a pipe dream. The main reason is the US has refused to support the reform proposals, particularly on the thorny appeal/review issues. “The main unfinished business on Okonjo-Iweala’s agenda is certainly the reform of the dispute settlement, which is still far from getting somewhere. Without achieving this reform, it is likely that the WTO will continue to lose relevance,” Crochet told World Finance.
Granted, the WTO is bound to remain as the backbone of the multilateral trading system. However, a growing number of experts are of the opinion that its continued legitimacy, credibility and efficacy require stronger leadership to reform the existing decision-making model based on consensus. “Creative approaches are needed to facilitate negotiations,” reckons Zhou. He adds that to ensure transparency, certainty and predictability in global trade, the global body must find ways of ensuring its rules and regulations remain sacrosanct.
Okonjo-Iweala has admitted the decision-making by consensus process is “frustrating,” and largely contributes to the snail pace of negotiations. However, it is necessary. This is because it accords the same power and voice to all members. Mongolia, with a population of 3.7 million and exports valued at $11.8bn, has the power to stop any agreement from being concluded, same as India with a population of 1.4 billion and exports valued at $452.6bn.
The fact that global trade blocks are crumbling means that Okonjo-Iweala will face a daunting task of rebuilding if she secures a second term. So far, she has not demonstrated any signs of the abrasiveness that can come in handy in resolving disputes and achieving breakthroughs in negotiations. This has earned her respect and prevented direct confrontations. However, when her tenure is finally documented in the annals of history, this might not count for much. What will count is her shrewdness in ensuring stability and order in the global trading systems.