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The upcoming 12th WTO Ministerial Conference should not only make progress on the current negotiation tracks, but also determine the areas of work for the future, in particular, to begin a discussion on distortions of competition. The Minister of Economic Development of the Russian Federation Maxim Reshetnikov stated this on Monday, 28 June, at a meeting of the World Economic Forum (WEF) Trade and Investment Leadership Group.
"This includes the topic of distortions of competition. Some believe that the reasons for these distortions are due to the provision of certain types of state support, even if such support is not regulated in the existing rules of the organisation. For others, it is due to the granting of various non-market preferences to multinational companies, leading to a gradual "takeover" of functions previously reserved for states and international governmental organisations. WTO rules need to be updated to meet this new challenge, but gradually - starting with a discussion of the scope of the concept itself," the Minister of Economic Development said.
E-commerce is another prime example of where WTO rules need to be adapted to the new realities. Online commerce has increased amid a pandemic that has accelerated the digital transformation of both everyday and business connections. In turn, the increasing pace of digitalisation has led to an increase in the risks that need to be addressed to protect users and consumers from new illegal practices, believes Maxim Reshetnikov.
At the same time, it is important that the process of updating the rules does not distort the fundamental values of the WTO. As an example, the Minister cited the prospect of changes to WTO rules in the context of combating climate change being discussed at the WTO. "We must not forget that the point of the WTO is trade liberalisation. This must remain unchanged. And any of the new 'green' WTO rules will need to be fully consistent with the core arrangements under the UN FCCC and the Paris Agreement, and not lead to unjustifiable restrictions on trade," said the head of the Ministry.
The Minister stressed that increased protectionism, including protectionism disguised as "good intentions", such as combating climate change, trade conflicts, sanctions and discriminatory practices will only postpone recovery from the pandemic to an even later date. "Such practices cannot be tolerated," he concluded.
The WEF Trade and Investment Leadership Group is the operational arm of the Trade and Investment Coordination Council. Approximately half of the Council is made up of G20 trade ministers, as well as the heads of leading corporations. Its role is to guide international cooperation between the public and private sectors on trade and investment priorities.