YOKOHAMA — The world trading system, based originally on the General Agreement on Tariffs and Trade (GATT) and now the World Trade Organization (WTO), celebrated its 60th anniversary Jan. 1. During its lifetime, tariffs declined to just one-tenth of what they were, while the volume of world trade grew 27-fold — three times faster than world output — bringing unprecedented prosperity for many.
In terms of what governments were looking for in postwar institutions, the GATT — and now the WTO — has been an outstanding success story, the like of which other organizations can only dream.
Yet paradoxically, the WTO is under serious threat. As the Doha Development Agenda struggles to conclude, critics are claiming that a failed Doha agenda will mean a failed WTO. At their joint G8 Tokyo Business Summit of April 17, Japanese business leaders rightly declared that a successful outcome to the negotiations by yearend was vital to reinforcing the rules-based multilateral system and therefore the global economy.