Perez, Oren

Reich, Arie

English

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FOREWORDTHE WORLD TRADE ORGANIZATION AT A CROSSROADSCONFERENCE AT BAR ILAN UNIVERSITY, ISRAELDECEMBER 12-14, 2004ARIE REICH & OREN PEREZIn December of 2004, scholars of international law, economics,and political science from four different continents gathered at BarIlan University in Israel to discuss the future of the World TradeOrganization ("WTO"). The title of the conference-"The WorldTrade Organization at a Crossroads" -is just as relevant today as itwas then. We chose the title in early 2004, immediately followingthe total failure of the Cancun Ministerial and amidst an atmos-phere of crisis in the entire multilateral trading system. This at-mosphere was slightly relieved the following summer, when newsof the compromises achieved in Geneva between the developedand developing member states' delegations reached us. This com-promise settled some of the more burning disagreements that hadled to the Cancun collapse, but did so at the expense of one of theorganization's most ambitious and celebrated goals- to broaden itsmandate into new frontiers, such as regulation of competition andinvestment, and liberalization of government procurement. It washoped that other disagreements could be resolved by the next min-isterial summit, scheduled for late 2005. Now, however, with theHong Kong Ministerial only a few weeks away, the sense of crisisis back as the main components of a breakthrough deal that couldguarantee the successful progress of the Doha DevelopmentAgenda are still subject to deep disagreement between memberstates.It is perhaps ironic that in the 21st century it is still the agricul-Published by Penn Law: Legal Scholarship Repository, 2014U. Pa. J. Int'l Econ. L.tural sector-not e-commerce, trade in services or intellectualproperty protection-that is at the very center of the world's tradenegotiations and drives the stalemate that is holding up any pro-gress in all the other more "modern" sectors. On the other hand,perhaps this is a reminder of the harsh reality of our times-foodand food production is still a serious issue and the gap between theeconomies and living conditions of rich and poor nations has notnarrowed at all, despite all the technological progress of the twen-tieth century. If developing countries are prevented from export-ing most of their agricultural products because of the unwilling-ness of developed countries to lower their high tariffs and farmsubsidies, how can we expect this gap to be bridged? If developingcountries' manufactured products continue to face high tariffs inthe developed world and uneven competitive terms with other ex-porters who enjoy the benefits of regional trade agreements orother trade preferences -how can developing countries be ex-pected to build developed industrialized economies? Maintainingthese barriers will strengthen the case of the anti-WTO movement,which argues that the WTO framework crystallizes (rather thanbreaks) the historical cleavages between Northern and Southerncountries.These and other eminent issues in connection with the DohaDevelopment Agenda were discussed at this three day conference.The conference also included a visit to Jerusalem's Old City andthe Supreme Court of Israel. Justice Elyakim Rubinstein of the Su-preme Court, formerly Attorney-General of Israel, met with theconference participants and spoke of the many challenges con-fronting a court in an ethnically, religiously, and culturally plural-istic society. This talk, set against the diverse cultural and religiousatmosphere of Jerusalem, was a fit setting for the conference's dis-cussions on how to bridge the deep economic, political, and cul-tural differences that underlie the current negotiations at the WTO.The need for protection of cultural diversity is discussed byTomer Broude in his article Taking 'Trade and Culture' Seriously:Geographical Indications and Cultural Protection in WATO Law, pub-lished in this issue. Dr. Broude reaches the conclusion that whileprotection of genuine cultural expressions is important and shouldbe taken seriously, the WTO's protection of Geographical Indica-tions in fact fails to make any significant contribution to the protec-tion and promotion of local culture and to the safeguarding of cul-tural diversity, and may, in fact, do just the opposite. Thus,proposals for similar sui generis trade or intellectual property disci-[Vol. 26:4https://scholarship.law.upenn.edu/jil/vol26/iss4/1FOREWORDplines that rely on a cultural protection justification, such as tradi-tional knowledge, should be treated with caution and acceptedonly after a rigorous cultural (not only legal and economic) analy-sis, in order to discern their real effects on both trade and culture.The question of the WTO's role in furthering non-trade con-cerns is also taken up by Oren Perez, albeit from a different per-spective. In his article, Multiple Regimes, Issue Linkage and Interna-tional Cooperation: Exploring the Role of the WTO, Dr. Perezquestions the validity of the emerging "linkage narrative." The no-tion of linkage seeks to replace the themes of conflict and animos-ity, which have dominated the "trade and -" debate, with a taleof synergy and mutual-support. This narrative was recentlyadopted by WTO Director General Pascal Lamy in his message tothe participants of a WTO symposium on Trade and SustainableDevelopment, when he declared: "Trade can be a friend, and not afoe, of conservation."1 While the idea that linking distinct regimes,such as the WTO and Multilateral Environmental Agreements,may yield synergistic benefits is intuitively compelling, it also suf-fers, Perez argues, from various blind spots which make its actualfeasibility doubtful. The article uncovers these blind spots by situ-ating the "linkage" hypothesis in a richer theoretical frameworkwhich recognizes the institutional complexities and ideological di-vergences that characterize the contemporary international system.Perez argues that realizing the synergistic potential of cross-regimelinkage requires policy makers to develop pragmatic responses tothese blind spots. The article then moves from the theoreticalplane into the muddy waters of WTO jurisprudence, discussinghow the idea of linkage -in the context of the trade and environ-ment debate- is dealt with under the WTO rulebook and the Dohanegotiation process. The article concludes by outlining several in-stitutional mechanisms which should facilitate the creation of sta-ble and mutually reinforcing links between the trade and environ-ment domains. While Perez's article focuses on the trade-environment nexus, its theoretical insights are relevant to otherdomains as well.The involvement of the WTO in non-trade issues also animatesArie Reich's article, The Threat of Politicization of the World Trade Or-' Pascal Lamy, Director General, World Trade Organization, Opening Ad-dress at the WTO Symposium on Trade and Sustainable Development within theFramework of Paragraph 51 of the Doha Ministerial Declaration (Oct. 10, 2005),available at http://www.wto.org/english/news e/sppl-e/spp07_e.htm.2005]Published by Penn Law: Legal Scholarship Repository, 2014U. Pa. J. Int'l Econ. L.ganization. Underlying Professor Reich's article is the fear that in-volvement in non-trade issues, in particular extraneous geopoliti-cal conflicts, may affect the WTO's ability to fulfill its objectivesand result in serious organizational dysfunction. The article notesthat the GATT/WTO has hitherto largely managed to stay awayfrom the major geopolitical conflicts of our time, unlike many ofthe other specialized agencies of the United Nations, and thus hasbeen able to better serve its objectives in the field of trade promo-tion. The article seeks to understand the reasons for this differencebetween the GATT/WTO and other intergovernmental organiza-tions, and more generally what it is that makes one internationalframework more attractive than others to the influence of "generalpolitics." By relating the notion of "politicization" to the theory offunctionalism, one of the most prominent theories of internationalorganizations, the article develops a definition of this notion that istheoretically sound and legally workable. The article suggests sev-eral explanations for the relative absence of politicization in theGATT. Based on these explanations, the last section of the articletries to assess the risk of future politicization of the WTO and thesources of that risk. It shows that many of the characteristics thatin the past protected the GATT from politicization are no longerpresent in today's WTO. Its growing membership, broadenedmandate in sensitive areas, and rising public profile are all likely toincrease the threat of politicization, as are the recent calls, bothfrom within and without the organization, for a revision of theconsensus rule. Indeed, there are already worrying signs of politi-cization within the WTO that are discussed in the article. If thesituation continues to deteriorate, WTO members may be facedwith major organizational dysfunctions in the future. The articleconcludes with suggestions on what can be done to counter thethreat of politicization of the WTO.Joshua Meltzer, in his article State Sovereignty and the Legitimacyof the WTO, explores a question which also haunts the articles ofBroude, Perez, and Reich-the legitimacy of the WTO. The prob-lem of extension of the range of issues that are dealt with in theWTO (through linkage or internal evolution) and the threat of poli-ticization, both raise questions with respect to the legitimacy of theWTO. Discussing this problem, Meltzer explores the relationshipbetween the idea of state sovereignty and the WTO, and the impli-cations of this relationship for the WTO's legitimacy. He arguesthat state sovereignty should be understood as comprising differ-ent and logically independent meanings, and that the implications[Vol. 26:4https://scholarship.law.upenn.edu/jil/vol26/iss4/1FOREWORDof membership in the WTO can be assessed only after we considerthe impact of globalization and the increasing power asymmetriesbetween states on the different meanings of state sovereignty. It isin this light that the impact of the WNTO on state sovereignty is as-sessed, andthe argument is made that the WTO strengthens, ratherthan undermines, state sovereignty. From the perspective of statesovereignty, state consent to the WTO is the starting point for anyassessment of the INTO's legitimacy. The article analyzes the ex-tent to which Appellate Body and panel decisions are consistentwith states' consent as an important source of WTO legitimacy.For instance, if the text of the WTO Agreements is assumed to cap-ture states' consent, attention to the text is the most importantsource of legitimacy for Appellate Body decisions. Nevertheless,the text of the INTO Agreements is often vague and ambiguous.As a result, the Appellate Body is often unable to base its decisionsentirely on the text. Yet because of the significance of the text as asource of legitimacy, the Appellate Body has increasingly at-tempted to justify its decisions by using strict textual analyses ofthe applicable WVTO Agreements. Meltzer argues that as a result ofvague, ambiguous, and incomplete WTO texts, the Appellate Bodyhas often been forced to rely on other justifications for its decisionsdespite its attempt to use only textual analyses. The article there-fore uses these different meanings of state sovereignty to suggestjustifications for Appellate Body decisions beyond state consentthat are still consistent with or reinforce other meanings of statesovereignty. The article argues that a clearer articulation of justifi-cations that are based on the sovereignty-enhancing role of INTOmembership will increase the legitimacy of Appellate Body deci-sions and avoid the otherwise tortured and often unconvincingtextual analysis that the Appellate Body currently feels that it isobliged to perform.The Bar Ilan conference produced several other important arti-cles that are not found in the current issue. Regional Trade Agree-ments v. the WTO: A Proposal for Reform of Article XXIV to Counterthis Institutional Threat2, deals with the institutional conflict be-tween regional trade agreements ("RTAs") and the INTO, and of-fers a proposal to respond to this institutional threat. By suggest-ing substantive harmonization and institutional centralization of2 Colin Picker, Regional Trade Agreements v. the WTO: A Proposal for Reform ofArticle XXIV to Counter this Institutional Threat, 26 U. PA. J. INT'L ECON. L. 267(2005).20051Published by Penn Law: Legal Scholarship Repository, 2014U. Pa. J. Int'l Econ. L.RTAs with the WTO, Professor Colin Picker hopes to eliminatemuch conflict and resulting resource diversion, and thereby stemthe continuing erosion of enthusiasm for the multilateral venue.Alternatively, Picker hopes his article will serve as a "wake-upcall" for the most powerful WTO members, so that they may rec-tify the damage and avert the potential disaster he believes RTAswill produce. Other articles from the conference have been, or willbe, published in other academic journals.3We would like to take this opportunity to thank all the partici-pants who came to Israel from near and far during somewhat trou-bled times in order to contribute to the success of this productiveconference. Thanks are also due to the Board and Editors of theUniversity of Pennsylvania Journal of International Economic Law,who placed their trust in the success of the conference long beforeit was convened and whose commitment to excellence has pro-duced this great issue.ARIE REICH & OREN PEREZBar Ilan UniversityConference Organizers3 G.E. Evans, LAWMAKING UNDER THE TRADE CONSTITUTION: A STUDY INLEGISLATING BY THE WTO (2d ed., forthcoming 2006); Ari Afilalo & Dennis Patter-son, Statecraft, Trade, and the Order of States, 6 CHI. J. INT'L L. (forthcoming January2006); Claire R. Kelly, Power, Linkage, and Accommodation: The WTO as an Interna-tional Actor and Its Influence on Other Actors and Regimes, 24 BERKELEY J. INT'L L.(forthcoming January 2006); Joel P. Trachtman, The INTO Constitution: Toward Ter-tiary Rules, available at http://ssrn.com/abstract=815764 (last visited Sept. 1, 2005);Thomas Wilde, Comments on the Discipline of National Treatment in International In-vestment Law: Boosting Good Governance Versus Intruding into Domestic RegulatorySpace? (Sept. 2005) (on file with the author).[Vol. 26:4https://scholarship.law.upenn.edu/jil/vol26/iss4/1

World Trade Organization at a Crossroads Conference at Bar Ilan University, Israel December 12-14, 2004

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World Trade Organization at a Crossroads Conference at Bar Ilan University, Israel December 12-14, 2004

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