Global Policy Forum

By Martin Khor
Director, Third World Network

The months-long contest for the job of Director-General of the World Trade Organisation has reached a dramatic and less-than-pleasant climax. Supporters of Mike Moore, former New Zealand Prime Minister, claim victory. They want Thai Deputy Premier, Dr Supachai Panitchpakdi to withdraw. But the countries supporting Supachai claim that he has led in support all the while until manipulation by big players intensified. They are calling for a vote, which is being resisted by the US and some other countries. Underlying the bitter fight is a strong feeling by many developing countries that the WTO's decision-making process is again being manipulated in an undemocratic way to suit the interests of major powers.

The fight over who becomes the next Director-General of the World Trade Organisation has turned both dramatic and nasty over the past few days in Geneva. The issue has gone beyond whether Thai Deputy Premier Supachai Panitchpakdi or former New Zealand Prime Minister Mike Moore is the better candidate. At stake is the credibility of the WTO itself, as the months-old selection process has raised questions about the way key decisions are made and how the organisation seems to be susceptible to the influence of a few major powers, especially the United States.

Supachai is strongly backed by the Asean group in WTO and other Asian countries (including Japan and India), a majority of African countries, some European countries and a few key Latin American (Brazil and Mexico) and Central American countries. He is thus seen as a candidate of the developing world.

Moore however has the support of the United States, a key and perhaps decisive factor, since the US wields such enormous power at the WTO. He is also backed by many European countries (especially France), most Latin American and some African countries.

Previous Directors General of the GATT (the predecesor of the WTO) and the WTO have all come from developed countries, especially from Europe. It had been said at the time Renato Ruggiero, an Italian, was made D-G in 1995 that the next appointment would go to a candidate from a developing country. That would be fair, for after all the vast majority of the WTO's members are developing countries. And Supachai seemed an appropriate choice, given his experience as Commerce Minister and Deputy Premier and his scholarly record (he holds a PhD in Economics, specialising in development planning). Moore too has an interesting history, having risen from trade union leader to Trade Minister and Prime Minister. The WTO members agreed that both candidates were excellent and suitable. In that case, many argued, Supachai should be given the advantage since he is from the developing world.

Indeed, for the past few months, Supachai has been ahead in the race, commanding a clear majority support. In a normal democratic procedure, involving some kind of vote, he would have been acclaimed the victor. But in the queer process of the WTO, decisions are made by "consensus." This theoretically means that everyone should agree or at least no one should object. Given such a vague concept, "consensus" has often really meant that decisions can be made only when the major powers, particularly the US, agree. At meeting after meeting at the WTO, no "consensus" could be reached to approve of Supachai, even though it was widely known he had clear majority support.

Then in the past two weeks, intense campaigning was made on Moore's behalf by the US. It is widely known that Washington made use of its extensive network and influence to contact the governments of many developing countries and persuade them to change their mind in Moore's favour.

Then, at a marathon WTO session last Friday that went well past midnight, the chairman of the WTO council, the Tanzanian Ambassador, Ali Mchumo, made a controversial opening speech, announcing that "the latest evaluation indicates" that Moore had the support of 62 countries against 59 for Supachai. He proposed that Moore be appointed the D-G. This raised a storm of controversy from Asean and other delegations supporting Supachai. They felt that the selection process had been manipulated, as there had been no announcement by the Chairman of the levels of support of the two candidates at previous meetings when it had been clear that Supachai enjoyed a clear lead. Moreover it was by no means clear how the "evaluation" or head count had been done, and by who, or when.

Many countries supporting Supachai said that there was no consensus in support of Moore, and that the best course of action would be to vote, which is provided for in the rules of the WTO when a consensus cannot be reached. This raised the objection of the US and other countries that claimed that since decisions had always been taken "by consensus," taking a vote would set a dangerous precedent and would split the organisation. Many developing country delegations find this argument difficult to follow. "It is only normal in a democratic process to vote, and the candidate or motion with the majority of votes wins, and everyone would then have to accept the decision," said Malaysia's Ambassador Hamidon Ali, who is also currently chairman of the Asean group.

At the heat of Friday night's debate, a few of Moore's supporters used undiplomatic language to criticise delegations supporting Suppachai, calling them "intellectually dishonest" for asking for a vote, and accusing them of being disrespectful to the chairman for not agreeing to his proposal. When the session resumed on Saturday afternoon, Moore's supporters were sending signals to the media that the appropriate solution was for Supachai to withdraw.

But that was not to be. Instead, Hamidon made a strong statement on behalf of Asean, saying that what was at stake was not a contest between two candidates "but the viability and integrity of the decision-making process" in the WTO. He explained that at first Asean went along with the "no veto, no vote" understanding. Supachai had consistently been the leading contender, and if the "no veto, no vote" understanding had been observed, consensus should rightfully have been declared in his favour. "Furthermore in a consensus-building process, the formulation of consensus is not deferred indefinitely in a manner which accords the non-leading candidate every conceivable opportunity to catch up. "Being a rules-based organisation, we have no other choice at this stage but comply with paragraph 1 Article IX of the WTO Agreement, that is, we go for a vote." He described it as a right which cannot be blocked by anyone. "What would erode our organisation is not the exercise of the rights clearly provided in our rules. What would erode it is the effort to prevent such exercise."

Ambassador T.J.B. Jokonya of Zimbabwe made an even more stunning attack on the whole process. He criticised those who had used terms such as "dissidents", "blockbusters" and "dishonest" to describe Supachai's supporters, saying: "We the dissidents or assumed infidels were subjected to the most incessant vicious air raids and were even treated to scud missles." He described the previous day's debate as "hell breaking loose": "The most deadly arsenic diatribe was unleashed on those who dared to oppose the wish of the anointed in the name of the credibility of the WTO, of the process and indeed in the name of the Chairman."

On those who argued against voting on the ground that the "consensus concept " has served the WTO well, Jokonya made this rejoinder: "Of course it has. It has undoubtedly served the North well. For the Third World in the WTO, the subordinate players, our economic hope is supposed to rest in the process by which the wealth of the rich will trickle down to the poor countries.

"Tell me why the North has not even attempted to fulfil the promises of Marakesh (the agreements establishing the WTO) if consensus has served members well? Tell me why many years after coming into being both GATT and WTO have never had Southern representation in the Secretariat at a sufficiently high level?" He said Supachai's supporters had asked the chairman to call for a consensus around him as the leading candidate some time ago. But the chairman said he needed more time to consult. He added that instead the chairman had now called for a consensus around Moore when there was an indication he had caught up.

Jokonya called instead for a vote, saying that "a request for a vote in the absence of consensus is very much part of the process of this organisation." He added that past GATT leaders had been from the North and it was time to accept leadership from the South, especially given Supachai's calibre, and this would make the WTO more global and acceptable. But, he added, "we know that when pick came to shovel, the election of the D-G would once again derive from the massive pressure of political forces."

The WTO Council will meet again this week to try to resolve the conflict. Meanwhile the organisation is without a Director-General as Ruggiero left his post on 30 April.

Thailand rejected a United States-led call yesterday for Supachai Panitchpakdi to quit the race for the top World Trade Organisation job.

In Geneva, Mr Supachai, deputy prime minister, said: "We're not pulling out," and in Bangkok, Surin Pitsuwan, foreign minister, said: "We are solidly behind Mr Supachai. There is no question of his withdrawing."The prime minister said he had called Mr Supachai to urge him to stay in Geneva and battle on. "I want him to stay and fight till the end," said Chuan Leekpai on his return from China.

Mr Supachai would expose the "improper conduct" in the selection process when he returns, said Mr Chuan, stressing Thailand would not resort to tricks. Mr Supachai had done the right thing by not promising deputy director-general posts in return for support for his bid. Bhichai Rattakul, a deputy prime minister, said a vote was the only way out of the impasse and the outcome should be considered the consensus.

Mr Bhichai also supported a call for Thailand to reconsider its foreign policy in light of the US conduct. It was time for Thailand to drop its tendency to go with the trend and instead adopt a firm stand internationally.

The reaction came as Uruguay's mission in Geneva called for Mr Supachai's withdrawal and said it was backed by 10 countries, including the US, France, Sweden, Turkey, Bulgaria and five central and south American states. In a statement, Uruguay argued that Mr Supachai's withdrawal would be the simplest way out of the impasse.

Long sessions of the WTO General Council on Friday and Saturday failed to decide whether Mr Supachai, or Mike Moore, New Zealand's former prime minister, should succeed Renato Ruggiero as director-general.

Ali Mchumo, the General Council chairman, postponed indefinitely a meeting to have been held yesterday. Mr Surin said the postponement would prolong confusion and harm the "efficiency and integrity" of the WTO. "As is, it is damaging enough for the organisation," he said.

Commenting on weekend meetings of the council, Don Pramudwinai, the Foreign Ministry spokesman, said Mr Mchumo had been influenced to act. The Tanzanian ambassador, he said, had not consulted William Rossier, the Swiss ambassador, who had been facilitating the selection process since October, four months before Mr Mchumo was named to his post.

After talks with Bernard Freymond, the Swiss ambassador to Thailand, Mr Don said he believed Mr Mchumo had not consulted Mr Rossier on a way out. Mr Don said the WTO race was "more dirty" than he thought possible.

Sources said the US, in a bid to advance Mr Moore's position, had sponsored travel to Geneva by 30 WTO members which lack missions there. Half are African, eight Caribbean, two Latin American, two Asian (Macau, and the Maldives) and three South Pacific. The US also promised African nations favourable terms on debts and on import quotas, the sources said.

Mr Supachai's supporters have also objected to Mr Mchumo's announcement on Friday that Mr Moore enjoyed more support across a wider geographical spread and a greater degree of acceptability. Mr Don said Mr Mchumo had failed to admit, when Mr Supachai was leading, that a consensus could not be built around Mr Moore.

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