WTO chief warns export controls risk exacerbating food crisis

WTO chief warns export controls risk exacerbating food crisis

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Government is risking repeating mistakes of past food crises export control among circling Commodity and energy prices, the head of the World Trade Organization said.

Ngozi Okonjo-Iweera, who became WTO director-general a year ago, also urged countries to accept a contentious deal on patent exemptions for Covid-19 vaccines in an interview with the Financial Times, saying The global supply chain crunch will last longer than previously thought.

Okonjo-Iweala’s tenure has been marked by successive waves of Covid-19 leading to disruptions in production and shipments, severe congestion in container shipments by land and sea, and the disruption of global energy and food markets due to the war in Ukraine.

“I do hope we have learned something from the last global food crisis in 2007-2008,” Okonjo-Iweala said, referring to a time when drought in major wheat and rice producing countries caused problems, as well as wheat and rice production country’s proliferation. energy costs. “The signs we’re seeing right now don’t suggest we’ve learned a lot because we’re dealing with soaring food prices, soaring energy prices and an ongoing spiral.”

“We should try not to exacerbate the problem by imposing export restrictions that may encourage others to impose their own,” she said. She said governments with excess stocks of products such as vegetable oils and grains should put them on the world market, although She declined to name specific countries.

Okonjo-Iweala, former Nigerian finance minister and World Bank managing director, said only about a dozen WTO members have so far imposed export restrictions to keep food at home amid loopholes in WTO rules is allowed to do so.

The Ukraine war has put enormous pressure on the WTO, the negotiating forum, as differences between Russia and the main coalition of wealthy governments that support Ukraine have spilled over into negotiations.These governments have issued statement Blame Moscow at WTO, block Belarus application join the institution and withdraw Russia enjoys so-called “most-favored-nation” status, enabling it to impose higher tariffs on Russian goods than other members of the group.

Okonjo-Iweala said governments that revoke MFN status are acting within their rights. “We obviously discourage this, but under WTO rules it can be done,” she said. Despite what she called “a very delicate situation,” the members have found ways to continue negotiations.

In a positive development, governments are on the verge of a breakthrough agreement to drop patent protection for Covid-19 vaccines under WTO rules to ease production in developing countries.This draft deal – With the agreement of the EU, US, India and South Africa core negotiating groups – criticize intellectual property (IP) rights being violated by pharmaceutical companies and health activist because it’s too narrow. The proposal will be submitted to the entire WTO membership for approval, which requires unanimous support.

“I think we have to act because this is a viable solution,” Okonjo-Iweala said. “We have to remember that the WTO is a negotiating forum. This is not a forum of orders. This is not a place where a party can come and say: ‘This is what I want, give it to me’???.”

The draft agreement comes despite the stark differences between the blanket moratorium on intellectual property initially demanded by South Africa, especially India, and the more limited approach pushed by the EU. “Ministers really have to be applauded for giving the necessary time for this,” she said. “They negotiated and tried to get a framework that they wouldn’t impose on anyone. They just said it was probably something we might go ahead with. The basics.”

Another big problem the WTO is trying to address is the dislocation of global supply chains. Congestion will start in 2021, especially at U.S. West Coast ports, after a surge in demand for consumer durables. This has been extended due to disruptions in production and shipments of Omicron coronavirus variants, especially in China. The war in Ukraine has worsened the situation by blocking trade routes and depriving Ukrainian and Russian sailors of routes.

Last year, Okonjo-Iweala was initially optimistic that the supply chain issues would be resolved soon, but she said she has gradually more pessimistic On deep questions.

Earlier this month, she convened a summit of CEOs of shipping, logistics and trading companies. “After listening to [the CEOs]I think there are more structural issues, which may mean that some of these may persist for a while,” she said.

“It’s not just port congestion. It’s a problem on land. They say we don’t have enough warehouses, we don’t have enough truck drivers. It’s not an attractive job anymore for many young people.” She Efforts to achieve net-zero carbon emissions also put pressure on the system because different vessels are required, which affects the amount of cargo that can be carried, said.

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