The Antigua and Barbuda victory at the WTO level was symbolically important in that it indicates that the WTO dispute settlement mechanism indeed works even for small and vulnerable States. Additionally this victory, through extension of deductive reasoning, indicates that the rules of liberalized trade do govern the ‘David’s and ‘Goliath’s of the world trading stage. While there are those who question the legitimacy of the fundamental fairness of the WTO, the outcome of this case apparently indicates that the rules of international trade are applicable to every Member State.
It is apparent that despite the ruling, the US has continued to flaunt the rules of international trade in this context. Antigua and Barbuda are claiming victory with regards to a WTO compliance review of the US with the 2005 ruling. Antigua and Barbuda WTO Attorney Mark Mendel has citied that the report of the compliance review gives the US ‘no place to hide and no way to try to explain themselves out of this’. See News Brief below.
However a niggling detail has not been overridden by the outcome of the 2005 dispute or by the report of the compliance review. The rule of international law as it relates to trade may be applicable to every State but there are limitations to the extent that these rules can effect fairness in the interactions between States. As the persistence of the behaviour of the US implies the rules of international trade may have little effect on the dynamics of power that still characterise the interactions of sovereign states. A philosophical question is presented here – To what extent can international law really govern the behaviour of sovereign states? Certainly within the WTO, consideration is extended to the effecting compliance with WTO rulings by giving Member States the right to impose sanctions on rogue states to encourage compliance with dispute settlement rulings. However the extent to which this is practical for small and vulnerable States is small (use another word than small). Not only is Antigua and Barbuda as an open economy highly dependent upon trade with the US but the imposition of sanctions against the US would have de minimis effect on a large economy like the US.
What is therefore the recourse for Antigua and Barbuda? There is reason to be cautiously optimistic that the US will comply with the WTO decision in the absence of the Antigua and Barbuda’s ability to impose sanctions. It is useful to be reminded that the resolve to have peaceful international relations is still a powerful incentive for any State to comply with international law. In this context, what is even more important is that powerful countries too need liberalized trade and are reliant on the cooperation of all states to ensure the transparency and legitimacy of the system of international trade and the rules that govern it. This is indeed reiterated by the US annual economic report prepared by the Council of Economic Advisors which as InsideTrade indicates, makes a case for further liberalization and the importance of removing non-tariff trade barriers.
Another consideration is the important link between US compliance and the success of the recently resumed Doha Round. WTO Director General Pascal Lamy in his remarks as Chairman of the Trade Negotiations Committee (TNC) at the February 2007 Informal Meeting of the TNC stated that
“Political conditions are… more favourable for the conclusion of the Round than they have been for a long time, and the challenge now is to make the most of them. Political leaders around the world clearly want us to get fully back to business, and we in turn need their continuing commitment.”
If this is valid then US compliance with WTO rulings would be symbolically important to the signalling of real political will to engage in the Doha negotiations particularly as they relate to the incorporation of the development needs of small and vulnerable developing States.
The question of US compliance will also impact bilateral US- CARICOM relations to an albeit different degree as they engage in the context of the US-CARICOM Trade and Investment Council (TIC).
Notwithstanding these considerations, political ‘massaging’ will still be necessary to motivate US compliance. Therefore Antigua and Barbuda will find it important to continue to consolidate with sympathetic countries like China and Brazil to inculcate US compliance which as Mendel indicates is the intention of Antigua and Barbuda.
It is apparent that despite the ruling, the US has continued to flaunt the rules of international trade in this context. Antigua and Barbuda are claiming victory with regards to a WTO compliance review of the US with the 2005 ruling. Antigua and Barbuda WTO Attorney Mark Mendel has citied that the report of the compliance review gives the US ‘no place to hide and no way to try to explain themselves out of this’. See News Brief below.
However a niggling detail has not been overridden by the outcome of the 2005 dispute or by the report of the compliance review. The rule of international law as it relates to trade may be applicable to every State but there are limitations to the extent that these rules can effect fairness in the interactions between States. As the persistence of the behaviour of the US implies the rules of international trade may have little effect on the dynamics of power that still characterise the interactions of sovereign states. A philosophical question is presented here – To what extent can international law really govern the behaviour of sovereign states? Certainly within the WTO, consideration is extended to the effecting compliance with WTO rulings by giving Member States the right to impose sanctions on rogue states to encourage compliance with dispute settlement rulings. However the extent to which this is practical for small and vulnerable States is small (use another word than small). Not only is Antigua and Barbuda as an open economy highly dependent upon trade with the US but the imposition of sanctions against the US would have de minimis effect on a large economy like the US.
What is therefore the recourse for Antigua and Barbuda? There is reason to be cautiously optimistic that the US will comply with the WTO decision in the absence of the Antigua and Barbuda’s ability to impose sanctions. It is useful to be reminded that the resolve to have peaceful international relations is still a powerful incentive for any State to comply with international law. In this context, what is even more important is that powerful countries too need liberalized trade and are reliant on the cooperation of all states to ensure the transparency and legitimacy of the system of international trade and the rules that govern it. This is indeed reiterated by the US annual economic report prepared by the Council of Economic Advisors which as InsideTrade indicates, makes a case for further liberalization and the importance of removing non-tariff trade barriers.
Another consideration is the important link between US compliance and the success of the recently resumed Doha Round. WTO Director General Pascal Lamy in his remarks as Chairman of the Trade Negotiations Committee (TNC) at the February 2007 Informal Meeting of the TNC stated that
“Political conditions are… more favourable for the conclusion of the Round than they have been for a long time, and the challenge now is to make the most of them. Political leaders around the world clearly want us to get fully back to business, and we in turn need their continuing commitment.”
If this is valid then US compliance with WTO rulings would be symbolically important to the signalling of real political will to engage in the Doha negotiations particularly as they relate to the incorporation of the development needs of small and vulnerable developing States.
The question of US compliance will also impact bilateral US- CARICOM relations to an albeit different degree as they engage in the context of the US-CARICOM Trade and Investment Council (TIC).
Notwithstanding these considerations, political ‘massaging’ will still be necessary to motivate US compliance. Therefore Antigua and Barbuda will find it important to continue to consolidate with sympathetic countries like China and Brazil to inculcate US compliance which as Mendel indicates is the intention of Antigua and Barbuda.
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