WTO Plurilaterals

  May 22, 2020

WTO Plurilaterals

What are plurilaterals?

On most matters, all WTO members subscribe to all WTO agreements. However, there some agreements which have a narrower group of signatories and are known as “plurilateral agreements”. 

WTO treaty allows members to pursue new trade obligations plurilaterally- among some members and not all seeking economic advantages. It is called “WTO-plus.”

Are they MFN-compliant?

WTO-plus benefits of these plurilateral trade agreements can be provided in one of two ways.

1.    Agreements can be MFN, which means their benefits can be provided inclusively to all WTO members, including those that have not signed the plurilateral agreement, as is the case with the WTO Information Technology Agreement (ITA). Or

2.   The agreements can be non-MFN, which means their benefits can be provided exclusively only to those countries that sign the plurilateral agreement, as is the case with the WTO Government Procurement Agreement (GPA).

What plurilaterals are being discussed presently?

Twelfth Ministerial Conference (MC12) at Astana, Kazakhstan in 2020 is likely to take up for plurilateral agreements:

1. Electronic commerce,

2. Investment facilitation,

3. Disciplines for micro, small and medium enterprises and

4. Gender

What is the background to the plurilaterals?

WTO members at the launch of the Doha Round in 2001 agreed for an ambitious development-centric negotiation agenda on agriculture subsidy, market access and services. However, irreconcilable differences emerged between the rich and developing countries. Big countries abandoned the multilateral issues and are pursuing new subjects of interest to their big corporates. This is the background for their pursuing plurilaterals. Many believe that plurilateral agreements can not be an alternative to the consensus-driven decision making at the WTO. They demand that even plurilaterals should be introduced only by consensus of all WTO members.

Developed countries do not agree. They took the first step and proposed four plurilaterals in the last 11th WTO Ministerial meeting at Buenos Aires in 2017. Areas are e-commerce, investment facilitation, MSME and gender. As many as 70-100 members support these. Even China is among them.

Many feel days of multilateral level rule-making may be numbered. The contestation is between developed countries on one side and large developing countries such as India, Brazil, South Africa, and Indonesia, etc. on the other. China has already joined most plurilaterals.

 In addition, the Astana meeting will also decide whether a post-2020 WTO will continue to operate on the principles of consensus, which is being seen as a major obstruction by developed countries.

What is India's stand?

India advocates multilateralism. India believes that plurilaterals do injustice to the non-participants in them.