WTO's Crisis Deepens as Global South and Superpowers Clash Over Trade Rules
The World Trade Organization (WTO) was once a cornerstone of the U.S.-led global economic order. Built on the belief in free trade, rising productivity and steady growth, it now faces growing challenges. As economic shifts and new powers reshape global trade, the WTO's role—and its ability to enforce rules—has come under strain.
At the recent ministerial conference in Yaoundé, deep divisions emerged. African nations pushed for more flexibility in industrial policies, while the U.S. struggled to advance its agenda. Meanwhile, China's economic model continues to test the WTO's market-driven framework.
The WTO was established in 1995 as part of a post-World War II system that blended consent with coercion, as theorist Antonio Gramsci once described. Initially, it expanded rapidly, growing from 128 to 164 member states. Many of these new members came from the Global South, which now holds a majority in decision-making.
For decades, the WTO reinforced a trade model that kept many developing nations dependent on raw material exports. But as Global South countries gained influence, they began blocking key agreements. India, for example, opposed extending the e-commerce moratorium in 2024–2026. Frustrated by such vetoes, wealthier nations turned to smaller, plurilateral deals among willing participants. The U.S. once dominated the WTO, using it to promote its vision of free trade. Yet by the 2008 financial crisis, its economic slowdown weakened the WTO's usefulness as a tool of American influence. Just before the Yaoundé conference, Washington proposed two reform plans, but these failed to gain traction. China's rise has added another layer of complexity. Its state-led capitalism does not fit neatly into the WTO's market-liberal rules. This mismatch has left the organisation struggling to adapt. Critics argue that international institutions like the WTO are not neutral. Instead, they often serve powerful states, preserving colonial-era inequalities under the guise of a 'rules-based order'.
The WTO now operates in a far more fragmented world than when it was created. Global South nations, no longer passive participants, increasingly shape decisions by blocking or delaying agreements. The shift toward plurilateral deals reflects this deadlock, allowing some members to move forward without full consensus.
With China's economic model challenging traditional trade norms and the U.S. no longer able to dictate terms, the organisation's future role remains uncertain. Its ability to balance competing interests will determine whether it stays relevant—or fades as a relic of an older economic order.
