The World Trade Organization’s Search for a New Director-General: The Consultation Process with the 159 Members Starts Today (April 2, 2013)

April 2, 2013

In an earlier Trade Flow from January 8th, I reviewed the start of the selection process for the new Director-General of the World Trade Organization (“WTO”). It has been a busy first quarter of 2013 for the nine candidates vying to take over the top Secretariat position from the current Director-General Pascal Lamy.

Each candidate was given an hour and a half in late January to present their views on their candidacy to the General Council and to respond to questions from WTO members. They were then given time for a press conference with media immediately after their presentation to the General Council. Candidates, working with their governments, have scheduled large numbers of meetings with members either in Geneva or in capitals (and for larger, more important trading countries with both). Certainly, some of the candidates have made many appearances before business and other groups around the world in the hope of building support for their candidacy.

Press reports have suggested horse trading going on between some candidates’ host countries and other WTO members. And importantly, the three individuals who will be shepherding the next phase in the selection process forward, were confirmed in a separate General Council meeting. See WTO Press/687, 25 February 2013. Thus, Ambassador Shahid Bashir of Pakistan is the Chair of the General Council and leads the consultations with the support of Ambassador Jonathan Fried of Canada, who is this year’s Chair of the Dispute Settlement Body, and Ambassador Joakim Reiter of Sweden, who is this year’s Chair of the Trade Policy Review Body.

The consultation and efforts to reach consensus start this week in Geneva with the goal of announcing the new Director-General by May 31st. To get there will require a lot of work by the three charged with consulting with members and by the members themselves. The rules require consultation with all members, whether they have a mission in Geneva or not. And the consultation process where there are as many candidates as there are in this selection process requires multiple rounds.

The Pakistani Ambassador and his two facilitators have already had many discussions with members to identify a plausible path forward in the search for consensus. Ambassador Bashir released a statement at a General Council meeting held at the level of heads of delegation on 19 March 2013 on how the next phase of the process will proceed. See JOB/GC/39, 19 March 2013.

He and his facilitators have announced the intention to have three rounds of consultations between now and the end of May, but have held out the possibility that a fourth round might be doable if problems arise which make arrival at a consensus after three rounds impossible. This seems to be consistent with the members’ view of the potential schedule. Similarly, members have indicated a desire that by the last round (the planned third), the field be reduced to two candidates. To achieve that, Amb. Bashir has indicated that four candidates will have to withdraw after the first round and that three of the remaining five will have to withdraw after the second round of consultations.

Members want the process to be a positive process and not a negative one. Therefore, members are being asked to identify their preferences (i.e., which candidates they can support), limiting themselves to four in the first round of consultations and to two in the second round. This information is obtained in “confessionals” where members meet individually with Amb. Bashir and his two facilitators, information is kept confidential, and where no negative preferences will be accepted. Thus, at no time are members indicating “I can’t support candidate X” – from my discussions in Geneva, an important element to keeping the process positive as viewed both by the Secretariat and by the members.

The role of the Pakistani Ambassador and his two facilitators can be critical, both in terms of the questions they ask members to answer, and the confidence members have in the three to apply the agreed rules in an acceptable manner. With 159 members, the winnowing down process is presumably not simply a matter of counting votes. For example, would a candidate who had a majority of the membership supporting him or her but no support from any of the majors (e.g., U.S., EU, China, Brazil, India) be viewed as being the consensus candidate – one assumes not. Thus, the Chair of the selection process reviewed how he and his facilitators would be construing the two critical paragraphs of the 2002 Procedures for the Appointment of Directors-General, WT/L/509:

Fifth, in assessing the information we receive and reporting to Members, we shall be guided by the elements set out in paragraph 17 of the 2002 Procedures, which states: “The Chair, with the assistance of the facilitators, shall consult all Members, including non-resident Members, in order to assess their preferences and the breadth of support for each candidate”. In 2005, the then General Council Chair explained that: “As regards the breadth of support, we considered the distribution of preferences across geographic regions and among the categories of Members generally recognized in WTO provisions: that is, LDCs, developing countries and developed countries”. The Chair also informed that other criteria were considered and rejected by Members in the formulation of the Procedures in 2002. As reflected in past decisions and in experience, and based on common sense, “breadth of support” means the larger membership.
Sixth, as you know, paragraph 18 of the agreed Procedures also requires that: “The outcome of the consultations shall be reported to the membership at each stage.” Accordingly, the outcome of this first round of consultations will be reported to all Members at an open-ended meeting of Heads of Delegation to be held as soon as possible following the conclusion of the first round of consultations. In respecting the dignity of the candidates and the Members nominating them, Members who nominated candidates will be informed of the outcome immediately after each round and before the rest of the membership.

JOB/GC/39 at 2-3 (19 March 2013).

At the end of the day, the selection process is an art and not simply an arithmetic exercise. How well members accept the exercise of the art form will determine in all likelihood whether there are difficulties that endanger a smooth road to a consensus candidate.

The first round of consultations starts on Tuesday, April 2 and goes for six business days, with each member signing up for 10 minute meetings with the three leading the consultations and with those not in Geneva communicating by fax or email. The first round meetings conclude on April 9 with the results revealed first to the countries with candidates and then to the membership as a whole. The second round will start after the withdrawals of the candidates not making it to the second round and after the General Council session of the heads of delegation.

So far the process has been working as intended, but the hard work begins now and depends on the good will of the candidates, their countries who have put them forward, and the willingness of the membership as a whole to arrive at a consensus amongst competing candidates at each stage.

In discussions with various delegations during this past quarter and with WTO watchers, one sees a number of considerations, other than simply the competence of the candidates and their vision for moving the WTO forward, that are often raised:

  1. Rotation to a candidate from a developing country, since the current Director-General (“DG”) is from a developed country (8 of 9 of the candidates are from developing countries, a term of self-selection);
  2. Rotation to a candidate from a country from a region that has not yet led the WTO (Africa and Latin America);
  3. Larger multilateral institution representation issues that may make skipping over one or more candidates more acceptable in light of other positions a candidate from that region may obtain this year or currently hold (e.g., Korea/UN; candidates from Africa and whether an African candidate will obtain UNCTAD leadership);
  4. Interests of one or more of the majors in a Deputy Director General slot for the next four years and whether that has implications for whether a candidate from the same region complicates obtaining that objective;
  5. Agreement between countries with candidates and other countries re support in the WTO or other international organizations on agreed areas.

How any given member chooses preferences in the consultation process is obviously something that will only be known by the member itself. Some, all, or none of the above factors may play a role in the thinking.

Initial reactions from at least a significant number of WTO members to the January exercise of candidates presenting themselves to the General Council were that two candidates were exceptionally strong – the New Zealand candidate (Minister Tim Groser) and the Brazilian candidate (Ambassador Roberto Carvalho de Azevedo), with generally strong reviews for many/all of the other candidates as well. Thus, most WTO members should be comfortable with a number of the candidates to help them move the WTO forward beginning in September. Still, some countries may have less global foreign ministry capabilities to facilitate meetings in all capitals of interest for their candidates. Some regions have perceived sharp divisions amongst existing WTO members from the region (e.g., Latin America, which has three candidates, is frequently mentioned as often having divisions amongst its members). Whether these or other considerations that are not based simply on the candidate’s ability to help members move the organization forward will prove decisive over the next two months may become apparent in the next few weeks as the first two rounds of consultations occur and the field moves from nine to a field of only two.

Importantly, the world will see within the next nine or ten days whether the process remains on track. If the four candidates deemed to be least likely to generate a consensus withdraw gracefully from the selection process and the messaging from Geneva and the major capitals remains positive, there will be an increased chance that the Director-General selection process will be a positive step in showing the world that the WTO can still function on at least some of the important issues before the organization.

When the dust settles at the end of May and a new DG (hopefully) emerges, the process will quickly shift to an internal one where the DG designee turns to selecting his or her Deputy Director-Generals (“DDGs”). In 2005, Pascal Lamy, the first DG to go through the current selection procedures, was announced as the new DG on May 26. WTO Press/407, 26 May 2005. On June 27, the WTO put out an announcement with a list of qualifications for the four DDGs that he was seeking to hire. Applications were due by July 10 and the DDGs were announced on July 29. WTO Press/415, 29 July 2005. Thus, one can expect June and July 2013 to be a busy period for the DG designee as he or she goes about selecting his or her key deputies. By way of comparison, with a European DG, the four DDGs geographically broke down: Latin America (Chile); North America (USA); Africa (Rwanda), and Asia (India).

For those who believe geographical distribution is a relevant/important criterion, selection of the Director-General could influence the outcome of the DDG selection process and create incentives for at least some members to prefer a DG from a region other than their own. It will almost certainly be an important issue once the new DG is agreed to. Unless one departs from the immediate past practice, one would expect the EU to pick up the DDG slot held by the region from which the new DG is selected.

The selection process heats up for outside observers for the next eight weeks. Businesses, labor, and NGOs should all care whether the disparate members of the WTO can follow the rules they set for themselves and make for a smooth transition to a new Director-General and a new team of Deputy Directors-General. The stakes are high for the WTO and its membership.

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