Creating Inclusive Global Trade

Robin van Puyenbroeck  0:10  

Welcome to Trade Wins. I’m Robin van Puyenbroeck, your host, and I’m excited to present this special series of seven episodes with a set of unique conversations I had with global leaders from the public and private sector during the WTCA 2021 General Assembly. The conversations happened during the last week of April with a live virtual audience from 70 countries. This gave me the opportunity to also poll a global audience on some very pertinent questions. Poll results provided not only further food for thought, but also calls to action. Now let’s get started. 

 

So welcome back and please join me in welcoming Mariette Mulaire, president and CEO of World Trade Center Winnipeg, also vice chairwoman of the WTCA and a board director of the Bank of Canada. Mariette will host our next session on creating inclusive global trade with a special guest from the World Trade Organization (WTO). Please make sure to fill any questions in the Q&A box and look out for our poll as well. So Mariette, over to you.

 

Mariette Mulaire  1:11  

Merci, Robin, great job. This is such a great event and congratulations to the whole team. This is very fun. I’ve been with the World Trade Center Association for a few years now and I’ve never seen us having a connection with the WTO, which is all about those connections that are natural. I’m so excited that today we’re going to be welcoming Bernie Kuiten from the WTO. The World Trade Center Organization is not the same as the World Trade Center Association. We are a network of global World Trade Centers around the world that are all about connections, helping each other out, and finding opportunities. The WTO is all about dealing with the rules of trade between nations. How important is that for us? Absolutely, big time. We’re going to have a conversation today with the WTO and how it plays a role with our members who are often small/medium sized enterprises. We will hear what kind of support the WTO can offer us. We will be talking with Bernard Kuiten who is the head of external relations of the WTO. Bernie joined the WTO in 1999, but has been head of external relations since 2009. Before that, he worked with trade negotiations. This guy knows what he’s talking about. His current responsibilities include WTO relations with businesses, with non-governmental organizations like ourselves, with parliamentarians, and with intergovernmental organizations. He provides general oversight of protocol and diplomatic matters and is a very active lecturer on the WTO and trade matters. He currently serves as a member of the International Geneva Council of the Swiss Network of International Studies. Please welcome Bernie Kuiten. Bonjour, Bernie.

 

Bernard Kuiten  3:12  

Thank you, Mariette. Merci. That’s a mouthful and the pressure is on now because you were just saying that I’m a guy who knows what he talks about. I hope I can live up to that and that you don’t look at me like another boring bureaucrat from an international organization somewhere. I’ll try to be very short and concise in saying a few words about the WTO and then go into what we try to do for the private sector and particularly for smaller and medium sized enterprises. The WTO governs trade and trade relations between its members. We have 164 members right now. We are an intergovernmental organization – it is very important to highlight that. This means that we have governments as our members; there are no businesses as members. There are no non-governmental organizations on our lists, only governments. We talk about government trade policies. The rules that we have are negotiated and they are binding. They are attempting towards further trade liberalization. I say attempting because trade negotiators come in with one particular mandate and it is actually to limit their own liberalization and get as much liberalization from each other. That also means that you move quite slow. Now, these rules and disciplines that we have are combined with what we call commitments. That means every member of the WTO committed to a certain level of liberalization –  tariffs, non tariff barriers, goods and services. We have agreements, those are the rules and disciplines that cover those commitments. That combination is for the private sector, those who trade. I’m not a trader. You, who are listening, are traders. They actually provide you or try to provide you with predictability and transparency. Even more importantly, the WTO tries to provide you with fair competition because that’s what this organization is all about. You know what you can expect if you cross a border with a good or a service. You also know that your competitors from other countries and from your own home country face the same sort of rules and disciplines, face the same kind of obligations. The idea is that you come into the market and compete on the basis of your quality and not on the basis of whether or not you have gotten support, whether or not you’re subsidized, or whether or not you are protected. That’s a very important thing. So equal treatment for all that trade. Now, the rules that we have and the commitments the countries make can be enforced. That’s why we are different from every other international organization in the world. We have a binding dispute settlement mechanism. It is a complicated mechanism that is currently in trouble because we lost part of it because of certain actions from our members. But the system, when it’s fully functioning, allows you to really enforce what the country that you’re trading in has committed too, which is very important. This makes a big difference. It’s not perfect. It’s far from perfect, I would say. 

 

Bernard Kuiten  6:10

One of the biggest problems we’re having right now is that our rule book, which was negotiated in 1995, has not been updated or upgraded. We’re not in the 21st century at WTO when it comes to our rules and to our disciplines. We need to reform and we need to update. For that, we do need our members. It’s not something that we as WTO decide. Our members have to do that, they have to negotiate. If they come to a conclusion, improvement, or a change, they have to agree by consensus. That means every member of the WTO has one voice and all of them have to agree. If one country disagrees, it won’t happen; you need to go back to the negotiating table. Now that, in a nutshell, is the WTO. 

 

Bernard Kuiten  6:50

The relevance for the private sector is transparency, predictability, and fair competition. It hopefully helps you to better know the rules of the game once you cross a border. It does not necessarily apply when you stay within the borders of your own country of your place of production. When you cross the border, then the WTO rules and disciplines come into play. It’s highly complicated. We are a technical, legal organization. Our rulebook is about 600 pages long and it’s written by a mix of politicians, economists, and lawyers. You can imagine how complicated that becomes as the end result comes out of three different sources. What we try to do, and particularly the team I work with, is try to help our external stakeholders and the private sector. The private sector is the most important one maybe, but in particular, right now, the biggest one. We help the private sector by providing training and by providing advice. We also can invite you over to come and meet our experts. I’m not necessarily an expert on all the things we do. However, we have a lot of technical people who know. If you have a specific question and you want to know more, we try to provide that for as many people as we can. We have a bit of a problem there. We’re a small organization. We’re about 650-700 people. You could say we are a medium-sized enterprise and we’re only based in Geneva. We are virtual too these days which allows us to do much more. We do have a limitation that some other international organizations do not have because they are literally placed all around the world. We’ve particularly tried to work with small and medium sized enterprises because we know that they don’t often have the means, the knowledge, or the people to concentrate on what we stand for. The big multinationals, in a way, don’t need us. They have the expertise. We do see them, but they often have the expertise already. We are currently having a group of countries at WTO who are trying to negotiate a deal specifically focusing on micro, small, and medium sized enterprises. That deal is trying to provide better information, better capacity, better trading, better access for smaller companies that are trying to cross borders. It’s a facilitation; it’s not a guarantee; It’s a facilitation for you to do business around the world. There’s also the Global Trade Helpdesk. I think other people are going to talk about this later on. The Global Helpdesk was set up by the ITC and then ourselves, specifically focused on many of your interests and seeing how they can help and advise you, because me and my team are very small. We’re trying to do what we can. We cannot service everybody. Now, the idea of inclusive trade, for us, is very much to bring smaller entrepreneurs into our discussions. We organize what we call trade dialogues at WTO, which is where we bring the private sector into the organization together with some of our members. Instead of going over all sorts of very difficult, complicated legal policy discussions, we literally ask companies, private sector entrepreneurs, CEOs, small/big, the smallest ones, the biggest one, what’s your problem? What are you facing when you’re out there in the world? I don’t want to hear the complicated story. Is your product crossing that border or is it stuck in a truck? Are there customs or procedures that are burdensome? We started these discussions in 2016. We’re doing it regular, we’re not regular enough, I think. That’s where we hear the real story. We don’t only provide information advice, we also want to hear from many of you. What is it you face? The time today is too short to hear a lot. I hope maybe afterwards, you can tell me more. But the idea is that this is an opening into the future. If you have questions we can get into that later on. I’ll stop for now, Mariette. Thank you.

 

Mariette Mulaire  10:35  

Bernie, that was a great, great first part. I don’t think that many people really realized, I certainly didn’t, how you are absolutely on the ground there to help SMEs. You gave some of the examples there. Would you have a specific example that you can walk us through about working with an SME and what was the issue and how was it resolved? Can you give us a specific just for the audience to understand more? What’s in it for me kind of thing?

 

Bernard Kuiten  11:05  

Sure. Let me give you two examples. One is more an indication of what is done or what is asked for and the other one is a specific company example. The first example, we were approached a couple of years ago by a variety of different beer producers. They organized themselves into an association and they came to us and said, “Listen, we are beer producers and we’re competitors, actually. We often don’t really get involved in trade policy or trade rules made because we go local. We bottle local. We sell local. We were international producers, going into the country, but more and more, we are confronted with trade barriers, sometimes invisible ones. We know that these are multinationals. We don’t know that much about WTO. Can we come to you with people from our different companies and can we get a two day training on very specific parts of the WTO, technical barriers to trade, sanitary standards and how they are used in relation to trade walls?” We set that up. We had, I think, 15 people from all the major beer producers in the world. They stayed with us for two days, this was a time when you could still come. We were exposing them to all sorts of experts and they liked it. It was very technical, but they had technical people there. It worked. That’s the kind of thing we can do. The next example is a concrete example in terms of an advisor steering a smaller company in the right direction. We have a company from the United Kingdom. This was at a time when it was totally unclear whether the EU and the United Kingdom would come to a conclusion and continue doing business and trading in the way they have been doing when the UK was part of the European Union. This was a smaller company that produced detergents or produced detergent as B brands for supermarkets. It wasn’t too big. It had all of its raw materials coming in from EU member states. Obviously, when they were part of the European Union there were no borders. There were no barriers, there were no tariffs, there were no restrictions. They called up and they said, “Listen, we tried to find this, but we don’t have the expertise. We don’t have the knowledge. If we become completely external and there’s no trade deal, what will happen? Will we have additional costs? What are the tariffs?” They called me up and asked. And I said, “Well, let me check. Give me the indication. What are the products? What are the classifications?” So I go to my colleagues, my experts. And they said if you look this up, EU tariffs,external tariffs on these particular products, this is what they are. They gave me the information. I went back to them and said, “If you will start doing your business, these are the tariffs that the EU has on these two or three products. If the UK government decides, without a deal or without a trade deal, to copy those tariffs, that means that you as a company in the United Kingdom will start paying quite substantial, 6-7% tariffs on your raw materials that you import to produce this detergent. Your costs will go up.” I said, “What you could do, first and foremost, is talk to the UK government to find out if they are planning to do so because it’s not guaranteed.” But the UK was then saying they were going to mirror what the EU was doing in terms of tariff barriers/non tariff barriers. “You should also contact your associations, your chambers of commerce, to sort of see if they can lobby for you.” I haven’t heard back from the company, so I presume it was all sorted. That’s a very concrete example. It sounds very simple. The problem here is that many companies do not dare to call us. They think, “Oh, we’re too small, they won’t help us.” Wrong. No. Come ask a question. I can always say no or we can always say, “Oh, we don’t know this, you should go there.” We can try to advise you. That’s a concrete example.

 

Mariette Mulaire  14:50  

I love it. First of all, you started with beer. It’s a bit early where I am, but that was a good one. And then detergent. I think that’s a perfect example, Bernie, because those are the kinds of questions people face. We know that there must have been so many questions between the UK and European Union for the last few years. This is a perfect example for our audience to hear. You did mention a little bit about the misconceptions of WTO. You mentioned that not everybody knows that you actually do this kind of consultation, that you can provide training for a specific group like you did. What are other misconceptions, would you say, Bernard, that people might have about WTO?

 

Bernard Kuiten  15:41  

I think the biggest misconception that exists in relation to my organization or the WTO is that many people still think that we set the rules. They really think that the WTO is an organization that determines trade policies for its members. No, it’s the other way around. The members decide on our trade policies and they negotiate with each other to come to agreements on where they would fix them, where they would create certainty. If they say a tariff is 5%, then under WTO, the tariff is 5%. It’s not me or my colleagues. There are still a lot of people that think that we do that and we don’t. There are also companies that call us up or write to us with very specific problems. They are stuck in a procedure in another country and they want to get a license and it’s being blocked by a particular ministry. They can’t continue their direct expansion, or they can’t actually deliver the products they were required to. It’s stuck in a container. It doesn’t matter. They come to us asking, “Can you solve this?” And we always say, “No, we can’t. We are an intergovernmental organization. What you need to do with this particular case is go to your government and your trade associations and ask them to lobby for you and ask your government to raise that with the government or the country where you have a problem.” Imagine that we would do this. Imagine that we would set the standards. That would mean that we would have unlimited and, I would say, very dangerous powers. I wouldn’t even want those. That’s the biggest misconception. We don’t set those rules. We don’t set those policies, our members do.

 

Mariette Mulaire  17:18  

That is a great clarification. As you know, the World Trade Center Association has members. Many, many of the World Trade Centers around the world offer trade services. It’s part of the core offerings that we have for our members. One of the things you mentioned, the Global Trade Helpdesk. I know that at World Trade Center Winnipeg, the team here has taken training that was offered by WTCA. I think I’d like to hear a little bit more about this whole Global Trade Helpdesk because, for us, it was very useful to see this tool. Can you talk a little bit to the audience about the tool itself and what it can do?

 

Bernard Kuiten  18:01  

Well, I can try to. However, I’ve learned a lesson from various people that work in the journalism business that if you don’t know the answer, just say you don’t know. I’m not an expert on the Global Trade Helpdesk. I know it’s setup. I know what it aims at is to help, to advise, and to guide entrepreneurs in the very, very difficult policy rules and disciplines for all. That’s about my knowledge. I see Robin going in.

 

Mariette Mulaire  18:25  

Yes, here is Robin. It’s such a great connection between WTO and what WTCA has offered. Maybe, Robin, you want to talk a little bit about this because I think it’s a very great tool. 

 

Robin van Puyenbroeck  18:37  

Thank you for bringing it up, Bernie. Good to see you again. You just brought up one of my favorite topics, which is working with beer producers. I also see you have Brussels in the background. Thank you for that detail. I would just like to mention regarding the Global Trade Helpdesk that at the end of the day we have a session with an introduction with someone from the International Trade Center that will go much deeper into what this tool is and how you can use it. Please bear with us.Towards the end of the day we have a session that will focus specifically on this topic. It’s a great collaboration and as the WTCA, we very much look forward to working much closer with the Global Trade Helpdesk bringing this tool to our membership and to the businesses that our members work with. It is time for questions from the audience, but before we do that, we will launch a poll. There’s a box on your screen. Click on there to take part in the poll. There are two questions. Question one is, “How important is it for global trade to be truly inclusive so the system can work for everyone?” The second question is, “Do you think you can contribute and play a role in creating a more inclusive economy?” Questions from the audience. Bernie, this is for you. How does the WTO ensure intellectual properties are protected, if that’s at all with you at the WTO?

 

Bernard Kuiten  19:56  

Yes, it is. We have an agreement that looks into intellectual property protection. We obviously don’t look into intellectual property rights or patents because there is a full other organization dealing with that. What we look at is whether or not these rights or these patents and the protection are being used or misused in relation to trade. It’s one of the most complicated agreements that we have. And friend and foe will agree, even my IP colleagues say, this is a complicated agreement. But the bottom line is, it tries to ensure that intellectual property rights remain protected and are not undermined by particular trade rules or regulations. It’s a very hot topic right now because we currently have a division between our members on a waiver on intellectual property rights in relation to the production of COVID-19 vaccines. There are some members that say you should waive those rights so that we can actually get the intellectual property rights and start producing this ourselves. Some others are saying, “No, we shouldn’t do it because it won’t serve its purpose because you need the technology, you need to know how to make them, you need to have the capacity. So even if you waive these rights, it won’t lead to many more vaccines being produced.” It’s a hot issue right now. It’s also, as I said, one of the most complicated issues.

 

Robin van Puyenbroeck  21:20  

Thank you for that. Another question. Is the multilateral, the trade facilitation, the discussions, is that being threatened or impacted now by COVID, by this crisis? Or is it business as usual, but by virtual means?

 

Bernard Kuiten  21:35  

On the contrary, on the contrary. We claim an important role. We see that trade, as such, plays an important role because we have been starting to analyze what governments were doing/are doing in relation to the pandemic in the area of trade. In the beginning, and we’re talking more than a year ago, we saw many governments installing all sorts of restrictions particularly in terms of exporting materials to input into vaccines or therapeutics and diagnostics. That is going down, but we’re watching them, we’re monitoring. That’s one of the roles that we play. We see the other way around that trade is being affected by the pandemic, partially because there is growing or there has been growing protectionism. It is also being affected because the economy, as such, is getting continuous and severe. I think many of your members, particularly small and medium sized enterprises, are being impacted more now than ever. What we’re trying to do right now and what my new Director General Dr. Ngozi Okonjo-Iweala is trying to do is bring different people together – governments, producers, institutions – to see, can we identify unused capacity? Can we improve the distribution of vaccines and overall scale things up? That’s not necessarily what the WTO does, but we can facilitate bringing people together. We are ourselves deeply involved in the discussion. Trade and health, also for the future, is a big issue for us. How can you ensure that trade is an enabler and not a brake on making progress either to fight a pandemic or coming out of one? And secondly, we’re trying quickly to help increase production capacity, even though we ourselves don’t, as far as I know, maybe in our cellars, but as far as I know, we don’t produce anything ourselves.

 

Robin van Puyenbroeck  23:28  

I very much am very intrigued by the fact that you mentioned that the new director general is making an effort to bring a lot of different people together and that sort of feeds into one of the next questions here. Also, for my audience, how can the WTCA and the WTO work more closely together? We’re both focusing on facilitating international trade, creating a more inclusive environment. How can we bring the tools that are available to the SME community, which is still the beating heart of economies in most countries in the world? Bernie, what can we do more?

 

Mariette Mulaire  24:02  

Well, I’m listening to Bernie. I think this is a great first step, Robin, to actually look at what we each other have to offer. We’re each a different animal, but the regulations and the responsibility that WTO is offering is so important for people to know. I think that the Global Trade Helpdesk is something that will naturally unite us because there’s going to be information there that absolutely relates to WTO. Bernie, you spoke about the pandemic and you spoke about protectionism. As it relates to trade, do you see any other trends that we can talk about – office space, people working more hybrid from home – but that isn’t necessarily trade? Are there things that the consumer, whether it’s what consumers are eating or the packaging or any kinds of trends that you can see that you will be looking at closer as it relates to what we’ve been going through in the last year in trade?

 

Bernard Kuiten  25:08  

One particular take on consumers, Mariette, and one particular trend that we’ve been seeing over the last few years, even before the pandemic, is a reemerging and growing interest from the consumer movements into what we do. Obviously, trade is a purpose. You try to actually provide a product or a service to a consumer. Consumers are, therefore, very important. You see a growing knowledge and growing interest, which is a good trend. We’re very much welcoming this because they get to have a say in this. The longer, bigger trends, it’s difficult to say because you are looking a little bit into a crystal ball here. What we find is a recent trend, also in relation to pandemics or other kinds of international crises, it is difficult to explain, but mistrust or lack of trust in governments, in international organizations and the tendency of going by themselves or going by yourself. It’s kind of an inward looking, isolationist approach, moving away from international cooperation and from multilateralism. You may say, “Well, of course you say this because you represent a multilateral organization.” No, it goes everywhere. It’s a concern that exists. There is no recipe for or no medicine to actually solve that. That’s a growing concern that we’ve had and it’s a problem that is growing. I don’t know if you noticed that, but we see a lack of interest in working together internationally. I think the problems that we’re facing right now, you cannot solve them on your own. You cannot solve them within one country. You do need to cooperate because as everybody always says, “A virus doesn’t know borders.”

 

Mariette Mulaire  26:48  

I think this is a great segment to look at how WTCA and WTO should even more than ever work closer together so we can better serve our SMEs.

 

Bernard Kuiten  26:59  

Yes! If I can say one thing on that, if I may, I know time is running out, is this is a very, very, very important first step. Thank you to Robin for actually reaching out and organizing it. The next steps are very simple and pragmatic. I’m a down to earth guy. I’m pragmatic. I say what I can do and I say what I cannot do. What I do know is that our door is open, that we have phone numbers, that we have email addresses, you have a face or other faces. People are willing to help. That’s the one big thing you have to understand. This is not a bunch of gray, faceless bureaucrats that sit virtually in our office. No, these are people that know things. They want to share. They want to help you. If they see someone with a problem, they will try to help. If they can’t, they will say that too, but they will try. That’s a very important thing and I think that’s where we can probably find ways of coordinating, communicating, and working together in all sorts of different ways.

 

Robin van Puyenbroeck  27:53  

Thank you, Bernie. We will definitely follow up with you. Mariette, thank you so much as well. Let’s have a quick look at the poll. Seventy-three percent of respondents say it is very important and 22% says it is important for global trade to be truly inclusive so the system can work for everyone. I think it’s very, very interesting feedback here. To the question, can you contribute and play a role in creating a more inclusive economy? We have 100% of respondents saying, “Yes,” that people do think they can make a difference. I think that is very encouraging. With this, thank you so much, Bernie, for joining us from Geneva. Mariette, of course, from Winnipeg to be here with us for this inspiring dialogue. I think you provided a lot of clarity on the work of the WTO and as WTCA we do look forward to continuing our dialogue and collaboration. 

 

I hope you enjoyed this special episode from our General Assembly. Make sure to tune in for all of the episodes. Thank you for listening.