New WTO Chief Starts Today

Spring day in the South sees a new broom that is expected to ‘sweep clean’ at the WTO in Geneva. Pascal Lamy of France today takes over the helm as Director General of the WTO, one of the world’s most influential jobs in the arena of multilateral organisations. The appointment, announced in May, sees the departure of Thailand’s Supachai Panitchpakdi, who many saw as the quiet champion of developing countries in the WTO arena. Confirming this, Panitchpakdi now makes a short move to head up the UN’s Conference on Trade and Development (UNCTAD) after 3 years as WTO chief.

Lamy comes to the WTO after a long career as a public servant in the European Union. Notably he was the Commissioner of the trade directorate of the European Commission where he has served for the last 5 years, leading the EU as their chief trade negotiator in the arduous Doha Round of WTO negotiations launched in 2001. While the metal of a WTO director general is tested by the incumbent’s ability to act impartially in the service of the Membership, it is undeniable that a sense of personal history is bound to forge that metal, especially in this instance where the incumbent crosses over from the negotiating floor to the ‘neutral’ seat on the podium. In the present instance Lamy is bound to bring some resilience to any rapid trade reforms, especially in the field of agricultural reform where the EU has been notoriously reticent to make meaningful progress. This being said Lamy is a confirmed multilateralist, who understands the intricate workings of a complex and politically fraught burocracy. In this regard the WTO secretariat have been known to complain about an indifferent management with little sympathy for their contribution to the trading system. They may find that things are stepped up a notch or two on the administration of the organization, as Lamy brings his vast experience in the EU Commission to bear. Probably most importantly, apart from his home contingent, he has the support of the United States. Robert Portman the US Trade Representative endorsed Lamy intoning that Lamy would ‘rise to the challenge of serving as the neutral leader and advocate of ambition in the ongoing Doha trade round.’ All very well.

However, in the run-up to Lamy’s election, Africa placed its support behind the former Mauritian foreign minister, Jaya Krishna Cuttaree, for the WTO top job. South Africa was however noticeably silent in making any direct statement of support for the Mauritian. Add to this the fact that near on 70% of South Africa’s trade is conducted with the EU, South Africa was the first country ever to conclude a bilateral free trade agreement with the EU and Lamy’s visit to South Africa late in the election process, it seems likely that he got South Africa’s vote. Africans should hope that Lamy is slow to remember the Cancun Ministerial Conference 2 years ago, and even slower to bear a grudge. In Cancun Africa embarrassed the EU’s top man in taking a no-go stance in reply to the EU’s difficultly obtained compromise offer to relinquish two of the four so called ‘Singapore Issues’ at the 11th hour of the talks (offering to give up competition and investment as negotiating topics, while Africa insisted that trade facilitation and transparency in government procurement also be given up). This was one of the main factors leading to the collapse of the Mexico meeting. The Economist subsequently referred to Africa’s euphoria at the collapse of the meeting as ‘scandalous rubbish’. Let us hope that Lamy does not bear a latent grudge, and that the trading system has moved on over the last two years.

What is interesting is Lamy’s choice of his four Deputy Directors General to assist him. The mix reflects the influence of the major players while attempting to balance this with a kaleidoscope from the developing contingent. Joining Rufus Yerxa from the United States who has served as a Deputy Director General 2002, will be 3 new faces, Alejandro Jara from Chile, Harsha Singh from India and Valentine Rugwabiza from Rwanda.

Africa can be rightly proud of Rugwabiza’s appointment. She has been the Rwandan representative at the WTO since 2002 and has thus built up a high degree of skill in the workings of the WTO. She is said to be infinitely popular with the African contingent and has been acting as the convenor of the so called Africa Group, the negotiating caucus of African countries in Geneva. She is also the first woman to hold office at the DG level in the WTO. What makes her particularly attractive is the fact that prior to joining the public sector in 2000 she worked in the private sector as an executive in a multinational corporation and then as an entrepreneurial business owner. Hopefully she will bring a lucid business flavoured African perspective to the machinery of the WTO secretariat. With this appointment Rubwabiza now becomes Africa’s second high placed lady in the WTO, joining Kenya’s Amina Mohammed who currently serves as the chair of the WTO General Council. South Africa was thought to be in with a chance in the selection process for the African slot for Deputy DG. It was speculated that Lamy would pick South Africa’s envoy, Faisal Ismail, to represent Africa. However South Africa seems to be fielding on the outfield in the Africa Group popularity stakes, and is perceived to be more aligned with the developing reformists in the G20 than with the Africa Group. Domestic political considerations were also mooted to have played a role in this regard.

Director General Lamy has indicated that his first and foremost priority will be to complete the Doha Round of trade negotiations, beginning with a successful outcome for the Hong Kong Ministerial Conference in December 2005. Let us encourage Director General Lamy to keep in the forefront of his work the fact that the Doha Round is a development round, and that Africa takes fist place in the development stakes.