Lot needs to be done to make global trade fit for future: WTO chief

She said there is a lot of work to be done in order to strengthen the trading systems

World Trade Organization (WTO) chief Ngozi Okonjo-Iweala on Thursday said a lot of work needs to be done to tackle the challenges facing global trading systems and supply chains, as she asserted that the future of trade is going to be digital and green.

Speaking at a special session at the World Economic Forum's online Davos Agenda 2022 summit, she also said the supply chain issue is an opportunity to 'reglobalise' to solve the world's inequality problems.

"Future of trade is digital and future of trade is green. For that, we need to strengthen our multilateral systems. We have frameworks but the frameworks need to be strengthened," said the WTO Director-General.

 

She further said there is a lot of work to be done in order to strengthen the trading systems and to be fit for the future of trade.

Speaking during the same session on 'Restoring trust in global trade and supply chains', US Trade Representative Katherine Tai said, "Our goal really should not be to go back to the way things were in 2019."

She emphasised the need to build supply chains that are better and more resilient, after the pandemic.

The panel discussion, moderated by World Economic Forum (WEF) Founder and Executive Chairman Klaus Schwab, focussed on pandemic triggering a shift from a mindset of "just in time" to "just in case".

They also discussed what domestic and international changes are needed to ensure the resilience of global supply chains and to rebuild support for trade as an engine of development and prosperity.

Schwab called for a more 'human-centred' global trade system.

A virtual meeting of key members of the WTO will take place on Friday on the sidelines of the Davos Agenda summit, during which issues like the WTO's response to the COVID-19 pandemic, proposed pact on fisheries subsidies and reform will be discussed.

India and South Africa are pushing for a decision on their proposal for a temporary waiver of certain provisions of a WTO agreement on intellectual property rights to deal with the coronavirus pandemic.

The meet assumes significance as the 12th Ministerial Conference, the highest decision-making body of the WTO, was postponed for an indefinite period due to the outbreak of the highly-transmissible Omicron strain of the COVID-19 virus. This was the second time the event has been postponed due to the pandemic.

The WTO is a 164-member multilateral body which formulates rules for global exports and imports and adjudicates disputes between two or more than two countries on trade-related issues.

During another session at the WEF event, business leaders discussed how ESG (environmental, social and governance) metrics can help create a sustainable future.

"The idea is to get these things standardised, then investors won't be confused," Bank of America Chairman and CEO Brian Moynihan said.

Accenture Chair and CEO Julie Sweet said, "This is about competitiveness. Those companies who have embraced sustainability are more profitable."

What started as a project to help make sense of the confusing multitude of possible ESG disclosures, the WEF's Stakeholder Capitalism Metrics lay out a universal core set of non-financial disclosures companies can use.

Now, more than 140 businesses have shown support for the Stakeholder Capitalism Metrics initiative with over 50 already including the metrics in their reporting.

Royal Philips CEO Frans Van Hooten said the ESG alignment is important, but additional actions will also be needed to reach climate goals.

"Once we have transparency on ESG metrics, there needs to be a cost to not being sustainable, a cost to being wasteful, a cost to carbon emissions," he added.

In another session, astronaut Matthias Maurer joined the WEF live from space, as he took part in the discussions from the International Space Station.