Picking the Next WTO Director-General: Resignation and Early-Movers
May 26, 2020
This is the first in a series from the Scholl Chair on the selection of a new World Trade Organization director-general.
On May 14, Director-General of the World Trade Organization (WTO) Roberto Azevêdo announced he would be stepping down on August 31, one year before his term was set to expire. Azevedo’s resignation adds another challenge for the organization to overcome during a critical moment for both the WTO and the global economy. Fresh leadership with a bold approach to WTO reform could inject needed life into the lethargic organization. However, selecting a new director-general is no easy feat. It requires consensus among the members; there is no vote.
WTO members have decided that time is of the essence. Member economies have shortened the selection process from nine months to three months. So far, there are five candidates who have either announced their intent to seek nomination from their government or rumored to be in the running. Who is ultimately selected could be a strong indication of the organization’s future. If member states can reach a consensus on the new director-general, maybe they can find a consensus on some of the other challenges outstanding as well.
Q1: Why did Azevêdo step down?
A1: In his resignation speech, Director-General Azevêdo advocated for the need to “decouple;” not between China and the United States, but between the selection of the next director-general and the biennial Ministerial Conference. MC12 was scheduled for June of this year in Kazakhstan but was delayed until 2021 due to Covid-19. Under normal circumstances, the selection process for Azevedo’s successor would have begun in December, after the ministerial. The new calendar would have forced WTO members to simultaneously consider a new director-general and negotiate outcomes for MC12. Azevedo claims his resignation is a bid to avoid that sequence, which he warned could jeopardize the ministerial. By resigning early, Azevedo is creating conditions for a new director-general to put their own stamp on MC12 and, therefore, the future of the WTO.
Q2:Why does Azevêdo’s resignation matter?
A2: The WTO Secretariat has a staff of around 700 that the director-general is responsible for managing. As a member-driven organization, the key role of the director-general is to help build consensus among members. At the present moment, that is no easy task.
Each of the WTO’s three primary functions—negotiating, monitoring, and settling disputes—is under stress, in large part because members cannot reach consensus on how to improve any of them. If the selection process for a new director-general turns into the next battleground at the WTO, the organization will continue to wallow in stasis. On the other hand, if members can reach consensus to select a new director-general with ambitions to jumpstart the organization, the future of the WTO will brighten significantly. That said, it is worth repeating that regardless of who holds the director-general position, the WTO’s future is ultimately in the hands of its members.
Q3: How will the new director-general be selected?
A3: The current procedures for the selection of the director-general were adopted by the General Council on December 10, 2002. Keeping with general WTO practice, consensus among the membership is required to select a new director-general. Normally, the selection process begins nine months before the expiration of the director-general’s four-year term. During the first month, member states nominate candidates who are interested in the position. Candidates cannot run without being nominated by their government. The WTO recently announced that the window for nominations will be between June 8 and July 8 for the current selection process. Candidates then have the opportunity to meet with the General Council (composed of WTO members), answer questions, and present their views.
Once the window for nominations has closed, the chair of the General Council along with the chairs of the Trade Policy Review Body and Dispute Settlement Body—referred to as facilitators for this process—will initiate rounds of consultations with the WTO membership with the goal of reaching consensus on the next director-general. In previous iterations, members have been asked to voice their preferences for fewer candidates than are in the running to narrow the field. Usually several of these “consultations” are carried out before a candidate capable of garnering consensus emerges. The number of candidates put forward has consistently grown—from three in 1995 to four in 1999, five in 2005, and nine in 2013. So far, five candidates have announced their intention to run or have been rumored to be joining the race.
The most common point of contention, and criteria, for selection is the regional representation of the candidate. Azevêdo’s election in 2013 was strongly contested. He was the first director-general from South America, leaving North America, Africa, and the Middle East as the only regions that have yet to be represented as head of the international body. Two contradictory arguments have emerged so far. African nations argue it is “their turn.” But developed nations point out the WTO’s recent history of alternating directors from developing and developed economies and argue it is their turn, since Azevêdo is from Brazil, a developing country.
Q4: Who are the candidates?
A4: The deadline for nominations for the position of director-general of the WTO is July 8. While final nominations are yet to be submitted, several names have been floated for the position, including the following:
Hamid Mamdouh has extensive experience as a trade lawyer, member of the WTO Secretariat, and trade negotiator for Egypt. Along with his extensive experience, Mamdouh has emphasized his “vision from an African perspective” as part of his director-general bid—playing into the regional aspect of the selection process. That vision includes the need to grow intra-African trade, ensure global trade benefits developing and least developed countries, and maintain a functioning rules-based system that protects the rights of African members. But overall, he claims that expectations of the WTO have not matched benefits accrued by African countries. Mamdouh also recognizes the WTO is in need of reform and adds that success will only come from a combination of technical expertise, political judgement, and acknowledging the importance of Africa in the global trade regime.
Mamdouh currently serves as a senior counsel at King & Spalding LLP. He was a director of the Trade in Services and Investment Division of the WTO. Previously, he served as a senior counsellor in the Services Division and was secretary of the WTO Council for Trade in Services. During the Uruguay Round negotiations, he was the lead Secretariat official for the drafting of the General Agreement on Trade in Services. His positions in the General Agreement on Tariffs and Trade (GATT), the WTO’s predecessor, included assistant to the deputy director-general of the GATT and legal advisor for the GATT dispute settlement. Before joining the GATT in 1990, he served as a trade negotiator for Egypt. While at the WTO, he advised dispute panels relating to trade in services, advised governments about treaty obligations, and provided technical assistance to developing countries.
Yonov Fredrick Agar currently serves as deputy director-general of the WTO. Like his fellow candidates, Agar checks the regional box, coming from Nigeria, and brings deep trade experience. His responsibilities include the Trade Policy Review Division, Development Division, and the Institute for Training and Technical Cooperation. He was first appointed as the deputy director-general in October 2013 and was reappointed for a second term in October 2017. Speaking at the United Nations’ High-level Political Forum on the Sustainable Development Goals (SDGs), Agah called for greater cooperation among international organizations to revitalize global partnerships for development and to deliver the SDGs—one of which calls on WTO members to reach an agreement to rein in harmful fisheries subsidies by the end of this year. He has also highlighted the importance of the free flow of knowledge—through transparency at the WTO, agreements that slash tariffs on information communications technology, and cooperation with other international organizations.
Prior to serving as deputy-director general, Agah was Nigeria’s ambassador to the WTO. In that role, he served as the alternate chief negotiator for the Doha Round and was chair of the WTO’s General Council in 2011. He has previously served as the director of external trade of Union Trading Company Nigeria PLC.
Ambassador Eloi Laourou currently serves as the ambassador and permanent representative of Benin to the United Nations and other organizations in Geneva, including the WTO. While serving as an ambassador during the United Nations Conference on Trade and Development e-commerce week in 2019, Laourou urged least developed countries to join e-commerce negotiations. Some have balked at doing so out of concern that an agreement would constrict policy flexibility in the digital economy space. During e-commerce week, Laourou argued that developing countries should participate in the talks to make their positions known and shape a potential agreement from the start.
Prior to leading Benin’s delegation in Geneva, he served as the deputy permanent representative of Benin to the United Nations, coordinator of the LDC Consultative group at the WTO, and deputy director of the European Department of Benin’s Foreign Affairs Ministry. Ambassador Laourou has served as a diplomat for 30 years.
Dr. Amina Mohamed is a Kenyan international civil servant with a long career in public and foreign service. Like Mamdouh, she has placed an emphasis on the importance of African WTO members. She has held several positions at the United Nations and the WTO. Between 2000 and 2006, she worked as the ambassador and permanent representative for the Kenyan diplomatic mission in Geneva. At the WTO, she chaired the Trade Policy Review Body in 2003 and the Dispute Settlement Body in 2004. In 2005, she became the first woman to chair the WTO General Council. She was appointed cabinet secretary for foreign affairs in 2013 and was appointed as the cabinet secretary for education in 2018. In 2015, she served as the chair of the 10th WTO Ministerial Conference in Nairobi, which resulted in the so-called “Nairobi Package,” a series of commitments aimed at benefitting developing countries.
Mohamed penned an opinion piece in January calling for WTO reform efforts to be inclusive, not just determined by a select group of developed countries. She argued that momentum toward regional trade agreements should not and cannot replace the need for the WTO. African countries, she said, must make their priorities in WTO reform known and work through stalemates in Geneva to achieve breakthroughs. Mohamed was nominated for the position of the director-general of the WTO in 2013. She currently serves as the cabinet secretary for sports, heritage, and culture.
Lord Peter Mandelson, hailing from the United Kingdom, is a former European trade negotiator. He served as the European trade commissioner between 2004 and 2008. In that role, he oversaw EU trade negotiations and led negotiations during the WTO Doha Round. He has a history in British politics, including as secretary of state for trade and treasury, Northern Ireland secretary, and secretary of state for business, innovation, and skill during the Tony Blair and Gordon Brown government. Mandelson has also served as a member of parliament and director of campaigns and communications for the Labour Party.
Mandelson has stated that WTO reform will be incremental and a political exercise. He has claimed the job is not suitable for a “someone shy and retiring or who sees themselves as civil servant or a technician.” However, his own candidateship appears to have structural impediments, chief among them the need to secure European Union support amid the Brexit saga, and the need to secure UK backing from a Conservative government despite previously serving in Brussels. Furthermore, with a field full of African candidates, the path for Mandelson to gain support from African members is unclear.
Given the friction between the United States and China, between the European Union and United Kingdom, and the fact that the current director-general comes from Latin America, the stars may be aligning for the first ever WTO director-general from Africa. However, if there are multiple African candidates and if developed countries unite around their own candidate, that might give developed countries a significant advantage. The U.S. position is unknown at this point. It would be unusual for the United States to put forward its own candidate, but the current administration could well decide that doing so might be the best way to advance its reform agenda. The formal nomination process has yet to begin and there is still plenty of time for twists and turns. The Scholl Chair will update this analysis as new information about the nominations comes in.
William Reinsch holds the Scholl Chair in International Business at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Jack Caporal is an associate fellow with the CSIS Scholl Chair in International Business. John Hoffner and Sanvid Tuljapurkar are interns with the CSIS Scholl Chair in International Business.
Critical Questions is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).
© 2020 by the Center for Strategic and International Studies. All rights reserved.