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How to Save the Global Trading System

7 0
27.05.2026

The future of the global trading system is on the line. President Donald Trump’s tariff wars are often cited as the principal source of today’s trade uncertainty, but American frustration with the rules governing global commerce predates the Trump Administration.

In late March, the World Trade Organization, the body that helps set rules for global trade and is a home for trade negotiations, held its ministerial conference in Yaoundé, Cameroon. Top trade officials from the 166 member nations attended to discuss the course of the organization. Hashing out a work plan for WTO reform, advancing negotiations on fisheries subsidies, and e-commerce were high on the agenda.

Despite this being a time of American unilateralism, Washington demonstrated its willingness to engage constructively by sending its Trade Representative, Jamieson Greer, to the Cameroon conference with a clear agenda to negotiate an extension of a pause on tariffs for digital products. However, he faced strong opposition from Brazil and Turkey, who criticized the US for not prioritizing issues such as agriculture, which are central to the bulk of the WTO’s developing country members. The American position of defending tariff-free digital trade was entirely consistent with past practice. Greer left empty-handed, frustrated by the meeting’s failure to produce any concrete outcomes.

Five weeks later, in early May, as the Iran war roiled global energy markets, trade ministers from the world’s seven largest economies met in Paris for the annual meeting of the Group of Seven (G7). Though the WTO conference had not yielded any concrete outcomes, Greer lent American support to a renewed call by the group for “meaningful reform” of the WTO to “respond to contemporary trade realities.”

One such reality is the inflexible manner in which member countries apply a foundational WTO rule: the requirement that its 166 members treat one another equally. With the US signaling a desire for candid discussions on reform, other countries should seize the moment to salvage the global trading system, but doing so will require filling a major crack in its foundations. For Washington, fixing the problems in the trading system also necessitates a departure from its coercive unilateralism to a more coordinated, rules-based solution.

At the heart of the problem lies a core principle known as “most favored nation” (MFN) trading status, which requires members to extend the same tariff and trade benefits to all countries. Exceptions such as offering lower tariffs to free-trade agreement partners exist, but they are........

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