The WTO in an Era of Preferential Trade Agreements: Thick and Thin Institutions in Global Trade Governance

Abstract

This article examines how fragmentation of the global trade regime into preferential agreements, built on a multilateral baseline of World Trade Organization (WTO) rules, affects trade governance. The analysis relies on 105 interviews with trade policy professionals in core WTO members and a conceptual distinction between 'thick' and 'thin' institutionalism to capture institutional changes in the global trade governance architecture. The WTO's thick institutionalism facilitates institutionalized interactions among members of the trade policy community that are essential for transparency and dialogue and the rule of law character of the trade regime. It secures the continued belief of trade policy professionals in the WTO's centrality in trade governance. The thin institutionalism of the network of preferential agreements spells the return to à la carte forms of trade governance and benefits those with the technical and political capacity to successfully navigate the fragmented governance architecture. Ongoing institutional transformations shift global trade governance away from rules-based back to more power-based forms.

Forum Shopping Evidence in the World Trade Organization: A Social Network Analysis of Disputes Between Member States

“…The WTO Secretariat has identified 635 preferential trade agreements, which causes a fragmentation of world trade governance (TROMMER, 2017;WTO, 2018). For Aggarwal and Evenett (2013), this is the result of two simultaneous forces that are changing international trade, the first being the increased power of the major emerging economies in the WTO, which makes this forum less vulnerable to the influence of core countries.…”

“…However, Trommer (2017) argues that there are limitations in the rule-based nature of global trade governance.…”

“…These agreements undermine efforts for a transparent global trade, whose rules are simple and where cooperation prevails (TROMMER, 2017). In what the author calls "Preferential Trade Agreements Era," free trade institutions are more fragile and more conducive to the tricks of more resourceful partners.…”

The WTO in Buenos Aires: The outcome and its significance for the future of the multilateral trading system

“…What Buenos Aires also showed was further evidence that plurilateral negotiations are not only the “new normal,” they represent the only apparent form in which trade agreements will be delivered in the WTO. While there are clear and well‐documented problems with the plurilateral approach as a negotiating norm in the WTO (see, for instance, Scott & Wilkinson, ; Trommer, ), in the face of a continual blocking by some countries of any attempts to push the agenda forward—particularly by India whose stance in Buenos Aires of refusing to sign on to any initiative until a permanent resolution had been reached on public stockholding won it few friends—plurilateralism has become the only available avenue for attempting to negotiate trade deals. This was the case not only with the ITA expansion agreed in Nairobi and the spark of negotiations on e‐commerce in Buenos Aires, but it is also signalled in the intentions of groups like the Friends of Investment Facilitation for Development and of MSMEs (African Review of Business and Technology, ).…”

Why is China a Reluctant Leader of the World Trade Organization?

“…Existing accounts of the crisis in which the World Trade ÔDisorganizationÕ (Wong 2015) is apparently mired generally Ð and quite rightly Ð emphasize the structural factors conditioning the travails of global trade politics: in particular, the power imbalances generated by simultaneous US relative hegemonic decline and the on-going accretion of greater power by the larger developing countries which have stymied a wide-ranging multilateral accord (e.g. Wilkinson 2014, Muzaka and Bishop 2015, Hopewell 2016, Meunier and Morin 2016, Trommer 2017, Murray-Evans 2019. Similarly, there are three specific factors to which Chinese reticence is generally attributed.…”