Webinar: In Conversation with Minister Myung-Hee Yoo: Candidate for Director-General of the World Trade Organization

Dr John Nilsson-Wright

Good morning and welcome to Chatham House. My name is John Nilsson-Wright. I’m a Senior Research Fellow for North East Asia and, also, the Career Fellow at Chatham House and it is my great pleasure to welcome you all to this webinar Conversation with Minister Myung-Hee Yoo, Candidate for the Director-General of the World Trade Organization. This is part of a series of discussions that we are having with the eight candidates to take over the role of Director-General, and we will be using this opportunity to talk to Minister Yoo about her vision for the future of the World Trade Organization.

Let me begin, before I introduce the Minister, by just mentioning a few house rules. This discussion will be on the record, not under the Chatham House Rule, it will be on the record. Those of you who wish to tweet the substance of our discussion can use the hashtag Chatham House Events handle. And, also, can I encourage all of you to consider submitting your questions, using the Q&A function at the bottom of your screen. I’m sure, by now, you’re all familiar with the practicalities of Zoom webinars. So, use the Q&A function, not the chat function, and not using the raised hand function. We will have about 45 minutes or so for our discussion and we will begin with an interview between myself and Minister Yoo.

Let me briefly mention some key aspects of Minister Yoo’s biography. She is, as I’m sure you’re all aware, the first female Trade Minister of the Republic of Korea. She has considerable experience in the trade field, having worked in this area for more than 25 years, and has played a critical role and has taken key responsibility for WTO affairs since as far back as 1995, in her work in the Korean Minister of Trade Industry and Energy. In that time and subsequently, she has played a key role as Strategist for the Republic of Korea, with responsibility for a number of critical free trade agreements, a key negotiator for RCEP, the regional comprehensive economic partnership, the negotiator in the Korea-China FTA discussions, and, also, critically, the Korea-US Free Trade Agreement.

She is, as I think her biography demonstrates, somebody who has been actively involved in promoting multilateralism, with a wealth of negotiating experience, in a range of different issues. Just to mention a couple, serving in the APEC Secretariat between 2010 and 2014, and her work in the Korean Embassy in China between 2007 and 2010. Not perhaps insignificantly, for those of you who are joining us from the UK, as Trade Minister she concluded the UK-Korea Free Trade Agreement in 2019. In terms of her educational background, she has an MA in Public Policy from Seoul National University and a Doctor of Law from Vanderbilt University in the United States.

But without further ado, let me begin, Minister Yoo, again, by welcoming you to this discussion and asking, perhaps, a very general question to kick off our discussions. If you could tell us a little bit about your overarching philosophy on global trade, how, in your view of the international trading environment, how do you see your vision shaping the future of the WTO? And in setting out that vision, what do you think are the critical issues that the WTO will need to grapple with in the months and years ahead?

Minister Myung-Hee Yoo

Thank you. First of all, thank you for your kind instruct – introduction and good day everyone, wherever you are joining us from and let me, first, now, start with trade’s role in global economic development. And trade has been the engine of growth for the global economic laws, contributing to poverty reduction and, also, better standards of living. And the very purpose of the multilateral trading system is to ensure that trade would be the means to serve these objectives not of and itself and WTO has done quite well. Since 1995, when it was formed, the global trade increased from $5.2 trillion to $19.2 trillion in 2018 and global poverty rate reduced from 30% to 10%. And, also, there are 23 aspiring members at the WTO, which shows members believe in the people to role of the multilateral trading system.

But the very multilateral trading system needs to change, adapt and evolve, in step with changing realities, changing times and the global economy is now undergoing profound challenges. First of all, the sluggish economic growth, together with, combined with weak demand, and rising protectionism and trade tensions have been causing much strains on global trade. And now we have COVID-19, which has added fuel to this situation and global trade, actually, contracted for the first-time last year, since 2009 and the prospect for this year is expect to be worse. What’s more compounding is that gains from the trade are not fairly, well, equally distributed, so now, trade has been the subject of so much frustration across the world and, also, trade comes to affect more and more aspects of our lives and society.

Amid all this uncertainty, WTO has not been able to prove its weight with all its three pillars under stress. The role of the WTO is all the more important in these very rapidly changing, challenging times and we need to come out of this crisis stronger than before. And to do that I believe we need to rebuild the trust in the WTO to make WTO more relevant, resilient and responsive.

So, let me further expand into these three Rs. These three Rs are my vision for the WTO. The first, Relevant, WTO should be relevant. WTO should evolve in steps with changing realities that our busines faces every day and to do that, top priorities would be revitalising the negotiating function and, also, restoring the dispute settlement function. And second, WTO should be – should enhance inclusiveness and sustainability to be Resilient as a champion of open trade. And in that regard, we also need to address the issues for those people in countries, who have not gained much benefit from open trade and, also, we could address emerging issues, such as environmental issues that affect our daily lives. And last, WTO should be Responsive. WTO should be responsive to future emergencies over contingencies, like COVID-19. So, in terms of a crisis, WTO should be there to uphold stability and predictability of the multilateral trading system.

And if we look back the history, I mean, the history has shown us that collaborations, the global community’s collaborations have actually transformed global governance in times of crisis. Bretton Woods institutions were created aft – in the aftermath of World War II and, also, G20 was launched in response to Global Financial Crisis back in 2008. So, I believe that this crisis could be a moment of opportunity for reform, improvement and growth of the WTO and members could rise again to these challenges, to restore the WTO. And I hope that I could make a contribution to making the WTO more relevant, resilient and, also, responsible for the next 25 years and beyond. Thank you.

Dr John Nilsson-Wright

Minister, thank you. The – that idea of relevance, resilience and responsibility, I think, is – very neatly captures the essence you’re proposing. I was struck by your reference to the Bretton Woods system and the historical context. When one thinks back historically about the establishment of the Bretton Woods system, the critical role of the United States, in fostering that level of engagement, obviously, at the moment in the United States there has been, to some degree, a sense of caution or scepticism about some of that international co-operation. How do you see the role of the WTO, as an international institution, in reminding the United States and other countries of their responsibility to play that critical role in supporting international institutions like the WTO? How do you foster a sense of continuing global engagement at this difficult time?

Minister Myung-Hee Yoo

Well, I believe the US has also shown keen interest in the multilateral trading system. That’s why they have proposed a lot of ideas and, also, they have tapered various initiatives, also, actively engaged in the WTO meetings. But at the same time, I could also understand some frustration that some members have, in regard to especially the lack of progress at the WTO. WTO, for the last 25 years, has not produced any major multilateral trade agreements, except for Trade Facilitation Agreement. So, to some extent, the – this lack of progress perhaps might be the – part of the reason why members, some members, are so frustrated about the WTO and lost trust and faith in the WTO.

So, we should use this moment of opportunity for reform of the WTO, if members could rise up to the challenges. If we can revitalise the WTO system, the revitalised, well-functioning WTO system, could provide a meaningful platform for other members to address their issues at the WTO and to explore a way forward in the WTO. So, I believe now, during the last – for the last several weeks, I met with many Ambassadors in Geneva, but also, I have been speaking with many fellow Ministers around the world and I could see that the same disappointment and same frustration from the members. And I could also see, in regard to specific questions of, then, what to do, how to reform, members have really divergent views. But what’s most important is the third point, members have formed commitment in multilateral trading system. So, in some sense, COVID-19 has forced us to reflect upon what is really needed for the WTO and this – one silver lining of this COVID-19 could be members’ will to move forward. So, I would like to harness this members’ frustration, hope and will and to translate them into concrete outcomes. If we can build up success-by-success, that could generate further political will for more members to actively engage in the WTO and to discuss and resolve their issues at the WTO.

Dr John Nilsson-Wright

It’s very encouraging that you see, in a sense, crisis as an opportunity for individual countries to recommit, if you like, their support for the multilateral system. And you mentioned two issues, of course, the slowdown in the global economy and, very importantly, COVID-19. Specifically, where COVID-19 is concerned, what role should the WTO play? I’m thinking back to the AIDS pandemic in the 1990s, where, you know, the critical issue there seemed to be the question of intellectual property and how best to ensure that pharmaceutical companies that had developed some of the critical drugs that were needed in treating HIV/AIDS would, both, be commercially viable and, yet, able to ensure that their pharmaceutical products were distributed at a price that was affordable to many of the poorer countries of the world. Do you see those sorts of issues emerging again in the current discussion over COVID-19, or are there different substantive questions that – where the WTO needs to play a role?

Minister Myung-Hee Yoo

Yeah, also, yes, several – WTO can play a lot of role, not only in regard to the pharmaceuticals, but in regard to trade, as well. So, the difference between this COVID-19 and the situation that you’ve mentioned is that COVID-19 is both health crisis and economic crisis. And because of the lockdown for the last several months, now we have, also, economic fallout, negative impact of COVID-19 on the global economy. So, in that regard, WTO can play a lot of roles. I would say, first, WTO can enhance – should enhance its overall transparency of trade related measures, all those measures adopted in response to COVID-19, WTO should make sure that they are targeted, transparent, temporary and proportionate, so that they do not turn into permanent barriers.

And second, WTO should ensure free flow – free and smooth flow of goods and services. Of course, you know, in response to COVID-19, but later on, as a, sort of, midterm initiative, WTO should prepare some sort of mechanism that can put in place, in the future crisis, by future contingencies, so that WTO could uphold stability and predictability in the trading system in times of crisis.

And third, WTO could work together with other international organisations to overcome both health crisis and economic crisis. So, in regard to health crisis, the vaccine or pharmaceuticals that can be the issue that WTO will, perhaps, work together with other international organisations, like, you know, such as WHO or WIPO, or other organisations. But still, at the same time, we don’t even have a vaccine yet, so it’s important to promote the science and innovation and R&D, so that we can actually have a vaccine. But why? Without undermining the innovation and, also, R&D, but also, we need to keep the mind that WTO should work together with the other organisations about the equitable or affordable access to those vaccines or pharmaceuticals.

But at the moment, WTO has not had full in-depth discussions on this issue, but I believe I need to strengthen its co-operation with other international organisations. But not only in regard to health crisis, but also, in regard to economic crisis, WTO should work together with other international organisations, such as IMF, UNCTAD, World Bank, also, to help members have a quick recovery, prompt recovery. And, also, at the same time, to help members build better back, so that we have certain changes in the post-COVID-19 era, digital economy, or a green economy, or global supply chain disruptions, so the members could better deal with these new challenges in the post-COVID-19 era and come out if this crisis stronger.

And the first point I would like to, also, note is that those people of those vulnerable sectors in vulnerable countries who are hit hard need to also get assistance from the WTO or other international organisations, in terms of capacity building or technical assistance. So, these are the – some four areas that WTO can play a role in and – but I believe there are many other roles that WTO could play, together with, in co-operation with other international organisations.

Dr John Nilsson-Wright

Minister, you make a very persuasive case for co-operation between international organisations. I’d like, very briefly, and before we turn over to the questioning and Q&A, to talk about the broader international context between individual countries. There have, of course, been trade tensions, growing trade tensions between the United States and China and as the two largest global economies, they will clearly be critical in dealing with the current, both economic and health pandemic crisis. But, specifically when it comes to bilateral trade relations on issues of industrial subsidies, special and differential treatment in the WTO, what role do you think, as Director-General, you would like to take in trying to ameliorate some of those tensions between China and the United States?

Minister Myung-Hee Yoo

Yeah, thank you and thank you for the question, yes. As I said before, in the beginning, world functioning revitalises the multilateral trading system could provide a meaningful format – meaningful forum for both the US and China to have in-depth discussions and to explore a way forward. In regard to trade related tensions, of course, we cannot resolve all the bilateral trade tensions, but at least, in regard to trade related tensions. For example, if you look at the industrial subsidy issues, well, you know, certain domestic policies, such as subsidies, can have cross-border spill-over effects on trade. And if they have certain negative effects, impacts on trade, inconsistent with the WTO principles, such as fair trade and fair competition, we should look at the rulebook. So, whether the WTO rulebook can address that issue and if the rulebook – rule is already in there and then, it’s the matter of implementation and the committee work should be strengthened to address those issues. But if the rules are not clear or are not as efficient, are not even there, in that case, members should be open to reviewing the text and reviewing the rulebook to improve it.

So, as DG, first, I would like to say that this is a member driven organisation, so this is up to members, but Director-General could play a role of facilitators, how to serve as an informed, trusted and effective facilitator. But I will look at the rulebook, whether we could address how to improve this situation and these issues, based on the WTO rulebook and based on the principles of the WTO rulebook. And, actually, during my whole career in the govern – Korean Government and, also, in trade, as you mentioned, I have worked together with both the US and China, and also, you, UK. Just, you know, all countries spanning from least developed countries, to developed countries. So, I believe that I could better understand concerns, priorities and interests of all other countries, because, actually, Korea also has gone through this same exact stage of development and, also, have experienced growing pains in every stage of development. So, leveraging my experience and, also, expertise, I would work as an effective and informed facilitator and, also, honest broker, in moving forward in these discussions, so that they could find a common ground for talks and could agree on those common issues and can build success by success, which can generate, for the political will, to tackle other issues.

Dr John Nilsson-Wright

Thank you, Minister. Let me now turn to our questions from the floor. And just to remind those of you that are part of the webinar, that you are free, if you wish to indicate that you would like to ask your question personally, rather than have me read it out, do indicate, when you submit your questions, so that we can give you that opportunity. But first, if I can turn to a question from Dina Mufti, if I’m pronouncing the name correctly, to say a little bit more, Minister, if you could, about the dispute settlement specifically, what needs to change in the WTO dispute settlement in order for it to be more effective, in your judgment?

Minister Myung-Hee Yoo

Yeah, thank you for the very important question, yes. That is the – addressing the impasse at the Appellate Body and restoring a way of functioning dispute settlement system is the top priority agenda for the next Director-General. That really calls for our immediate action and prompt resolution.

But before I touch upon how to move forward, let me address why do we have this current impasse at the Appellate Body and dispute settlement system? There will have been – regarding the dispute settlement system itself, there have been long parallel views among the members on the nature and the role of the Appellate Body. Some say that Appellate Body should not engage in overreaching in its interpretation of the text, because it risks adding or diminishing the rights and obligations of the members, which is prohibited by the rulebook of the WTO. But others say that the interpretation of – Appellate Body’s interpretation is, to some extent, inevitable, because they are tasked to secure a positive solution to a case, a positive resolution to a case. So, in that case, these two parallel views have been there, not only just for the recent several years, but for decades. And, on the other hand, in a broader context, the stagnant negotiations and no progress at updating the rulebook perhaps induced members to rely, overly rely on dispute settlement system to resolve any outstanding issues that could have been preferably resolved by the members, through negotiations. And because of this situation, now, we have impasse, but for a long time, members have not been able to resolve these issues in a timely manner. That’s why we have this situation.

But as I mentioned before, I have been talking with Ministers around the world and, also, I met with many Ambassadors and I could see the members still share the value of dispute settlement system, compared to the third-party adjudication system. So, that could be our starting point, and we have several ideas already, by the members. One of them is a work proposal that deals with and that also produces some compromising ideas on various procedural matters, including some substantive issues, such as a 90-day limit. And, also, the US, and the – only this year they also published their views on both substantive and procedural matters about the Appellate Body.

So, we could put all these issues on the table and conduct and have in-depth discussions with utmost sincerity, because there are very fundamental differences among the views of the members. Rather than saying, you know, this could be the magic solution to resolve all the issues overnight, I would say that we could put all the proposals on the table and have in-depth discussions with utmost sincerity and out-accelerate those consultations in various configurations. And, also, if necessary, I would reach out to capitalists and Ministers to secure their political buy-in at certain point of time, so I will, together with the members, to find a prominent and effective solution in that issue.

Dr John Nilsson-Wright

Hmmm, thank you. Thank you for that very comprehensive answer. Could I change our focus a little bit to – I mean, we’ve talked about immediate crises, COVID-19 and the economy, but there are, of course, very substantive systemic crises that the international community is facing, not least on environmental issues.

Minister Myung-Hee Yoo

Hmmm hmm.

Dr John Nilsson-Wright

Colin McCulloch asks, “What should the WTO do specifically and proactively on the need for decarbonisation and other measures to mitigate environmental damage and the climate change crisis?” He argues that “Multilateral action is needed. Can the WTO be more than a follower of the outcome of the delayed COP26 process, for example, might the WTO co-ordinate carbon tariffs? Is this an area where you feel the WTO could play a constructive role?”

Minister Myung-Hee Yoo

Yeah, thank you. Thank you for the very good, important question. Actually, this COVID-19 pandemic has shed light on the need to have very sustainable development, including environmental protection, because this pandemic or any natural disaster could wipe out the old achievements that we have made for the last several years. So, it’s all the more important to achieve sustainable development and to preserve and conserve environment, so that the economic growth and, also, environment protection could be mutually supportive.

In the WTO, sustainable development is one of the key objectives of the WTO, included in that Marrakech agreement. But the issue is how to actually realise and implement it, operationalise it, in that various rules and various areas. And I understand that at the WTO, first, what we can do – before I move onto the anti-carbon measures, first, let me briefly explain what the WTO is currently doing, in their regard, for sustainable development. In the first one, WTO is currently having negotiations on fisheries subsidies issues to prohibit harmful subsidies, fishery subsidies, and that could also conclusion of then, negotiation, could contribute to sustainable development. And, also, there is a committee, named the Committee on Trade and Environment at the WTO. They’re discussing various issues: a circular economy, also plastic pollution and, also, the fossil fuel subsidy reform. And members could regalvanise these discussions and can revitalise these discussions to have more action-oriented outcomes. And we used to have, also, environmental goods negotiations, we could also explore whether we could resume that negotiation.

Now, let me move onto anti-carbon measures. The climate change, I understand the objectives of those measures, to combat climate change and, also, to reduce, to counter greenhouse gas emission. So, there has been an interface between environment and trade and trade rules and multilateral environment agreements. But the issue is to how for them to be mutually supportive, so that if those measures are used as a disguised protectionist measures or causing destructive effects on trade, some countries might have concerns. So, we understand the objectives of combatting climate change, but on the other hand, there are some countries who have expressed their concerns on the possible any destructive effect on trade.

So, it would be helpful if those measures could be devised in a way that is non-discriminatory, that can be applied through both domestically and all – both to domestic producers and, also, forwarding producers, without any discrimination. That could be, also, a good starting point to devise those measures. So, this is still very early stage at the WTO, in regard to that discussion. But I would assist members to have discussions on this issue and could find amicable solution between the trade and environment, so that those two very important objectives could be mutually supportive.

Dr John Nilsson-Wright

Hmmm, and related to that point, Minister, there is a question about the balance between the interests of developing in developed countries from Abdullah Shariff, who asks, “Would you support a lesser role for the WTO to play in the settlement of disputes between developed countries? Will you target any changes to the developing countries’ trade deals that are against the development interests of those countries?” I think Mr Shariff is trying to explore the question of the relative interests of developing in developed countries as they embrace economic growth, that may have negative environmental effects, as well.

Minister Myung-Hee Yoo

Can you repeat your question again?

Dr John Nilsson-Wright

Yes.

Minister Myung-Hee Yoo

Because, no, development and the divergence between development and developed countries and developing countries is actually related to many broader range of issues. So, that I could better pinpoint my – I could better, you know, focus my question on the particular – and my answer for the particular question. Could you repeat the question?

Dr John Nilsson-Wright

Yes, so I think Mr Shariff is trying to ask the question of how best to harmonise the interests of developed and developing countries, quite generally. But I would like to specifically ask you, in the context of environmental issues, whether there is a role to play in – for the WTO, in balancing the needs for developing countries, perhaps to embrace economic growth at a rate that has negative effects when it comes to the environment?

Minister Myung-Hee Yoo

Yes, that’s a very important, actually, question at the WTO. Well, we need to think about two things on that issue. First, now, we also understand that developing countries might need some policy space for their development in international agreements. So, if they assume the same obligations and same responsibilities, same as the developed countries, they might have concerns about the – their lost opportunity for their own economic growth and development. So, in that regard, during the negotiations, sometimes we provide flexibility to developing countries and especially listed developed countries, so that they could have a level playing field and, also, they could have some policy space for the certain period of time, a longer period of time. So, in the trade negotiations and, also, environmental related trading negotiations, we could negotiate those flexibilities for developing least developed countries.

But, of course, you know, there shouldn’t be a really total of doubt from the commitment. It’s better than, you know, focused on their actual needs and actual needs for the longer periods of implementation or technical assistance, or capacity building programmes, for them to actually fully implement the commitments that are made by all the countries and all the members. So, the flexibilities provided by the agreement, or by the negotiations itself, is one way and the other way is that even if you have provided all the flexibilities needed and protected your sensitivities in some way, but still, at the end of the day, developing countries might still have some difficulties. So, in that regard, international organisations, of course, the WTO, should provide relevant technical assistance and capacity building, so that they could implement these negotiations, this outcome of the negotiations, in a better way, more smoother, a smoother way. So, WTO should play a larger role, greater role, in providing technical assistance in capacity building programme.

Dr John Nilsson-Wright

Okay, thank you, Minister. I’d like to take a question from the floor, if I may, now, from Savita Saigal, who is a Lawyer and a Political Economist from Kuala Lumpur, who has a question that relates to currency in China-US trade disputes. So, I hope my colleagues at Chatham House will be able to provide an opportunity for Savita Saigal. Are you there? Yes, I see.

Savita Saigal

Hello, can you hear me?

Dr John Nilsson-Wright

Yes, we can hear you. Go ahead.

Savita Saigal

Okay.

Dr John Nilsson-Wright

You’re…

Savita Saigal

Thank you…

Dr John Nilsson-Wright

…and yeah, do you want to ask your question?

Savita Saigal

Thank you. [Mother tongue] Minister Myung-Hee Yoo.

Minister Myung-Hee Yoo

You speak Korean.

Savita Saigal

A little bit, I’m learning and I’m hoping to get better. I’m a Lawyer and a Political Economist from Kuala Lumpur, Malaysia and the Malaysian currency opens to the US currency, according to the Bretton Wood agreement, which many other countries do, as well. So, as you are aware, we have a lot of China-US trade tensions at the moment and this affecting the US currency, so it affects our currency and many other currencies in Asia. The new elections are coming up; we don’t know what the future is. So, my question is, how do you plan to go in and deal with these sort of trade tensions, which are happening between the bigger countries and they trickle down to affect the smaller Asian countries? With COVID-19, this is becoming even worse, because the economy is so bad now. What sort of – you know, how do you plan to counter this, now and in the future?

Dr John Nilsson-Wright

Okay, thank you for your question. Minister?

Savita Saigal

Thank you. Thank you.

Minister Myung-Hee Yoo

Yeah, yeah, thank you for the very important question. Yes, not only in regard to currency issues, but in regard to many other areas, yes, I understand that there are some tensions, trade tensions between the US and China. But at the WTO, what we can do is, actually, to deal with trade related tensions. So, regarding the trade related tensions, as I mentioned before, the WTO could revitalise the way of functioning, WTO could provide a meaningful platform for them to address those issues.

But in regard to your specific question on currency issue, well, you know, WTO are – has not fully addressed these current issues under the rulebook, because this is also governed by other financial institutes that have a more an authority on this issue. But – and, also, this has – issue has not been tabled as a, some sort of official proposal or of member countries at the WTO, but I understand that this current issue can affect some trade remedy cases, such as subsidies. But it’s still very early stage to discuss that issue, specifically because of the WTO members has not had a chance to actually look at some related proposals or papers and had a chance to discuss this issue. So, given the very early stage of these current currency issues at the WTO, rather than specifically mentioning currency issues, I would say that in regard to trade related tensions, the WTO can be a part of solution, because it has dispute settlement system and if it has – if it revitalised the negotiating function, it has also the function of updating the rulebook. So, using these various functions data, which you already has, it can provide a platform for those two countries to have discussions and explore a way forward.

And if they could find this, I would help them find common ground for talks and based on that convergences, common issues, we could try to build up more common views and agreements. And then, if we could achieve success, even modest success, they can build further momentum for them to move onto more structure harder issues. So, I would work together with them, but in regard to currency issues, as I mentioned before, we have not yet received any particular proposal or paper at the table at the WTO. So, at the moment, it’s rather than a – the issue that WTO should look at, is still need discussions at other institutions, while maybe in the future, maybe further discussions, together with the WTO and other dis – institutes together, need to look at this issue, but at the moment it’s very early stage.

Dr John Nilsson-Wright

Minister, you – we’re fast running out of time, so I want to take a couple of issues together, if I may. Keeping the focus on Asia, we have two questions, one from Chau – Torsten Gelanic, who cites Robert Lighthizer, who has argued that the WTO must be able to deal with the question of state capitalism and, obviously, in this context, he’s thinking of China. So, again, going back to what you were saying earlier, is there a, kind of, inevitability that trade tensions will increase, and can those trade tensions be in any way resolved bilaterally or multilaterally?

And Helen Gorgey, I think if I’ve pronounced her surname correctly, asks a more general question about the role of Asian economies. And perhaps here is an opportunity for you to draw on your experience, in the Republic of Korea, what role might Asian economies play in fostering multilateralism and are there specific issues that the WTO can play in resolving issues perhaps to do with trade liberalisation in Asia, where we’ve seen a proliferation of regional economic structures and initiatives, and of course, very important bilateral and emerging trilateral agreements?

So, perhaps if you could address those two issues, that would be very helpful. Before we move onto a final question, if I may, about services and related areas.

Minister Myung-Hee Yoo

Okay and thank you. The first question on state capitalism, well, when we say state capitalism, I want to more specify what kind of policies and measures we are looking at. Rather than discussing the economic model or economy itself, I think we should focus on the particular policies. As I mentioned before, government policies, even though it is domestic policy, it can have spill-over effect, cross-border spill-over effect on multiple countries on trade. And we have to focus on the measures and, also, what kind of effect the measures bring on and whether those effects are negative, negative impacts on trade, which is inconsistent with the WTO rules. And then, we should discuss what we can do, based on the WTO rulebook and as I mentioned, if the WTO rulebook is not sufficient or clear enough, members should be open to reviewing it.

That applies to any other rules, not only the subsidy rules, but any other rules and right now, there might be a discrepancy between 25-year-old WTO text and the current 21st Century economic realities. And subsidy rules, for example, itself, have – has evolved over the time, throughout the GAAT and, also WTO, members negotiated and developed subsidy rules from 1947, Article 16 in GAAT, and also, subsidy code in 1979, and also, a subsidy agreement in 1995. So, likewise, if there is a gap and discrepancy between the rulebook and the current text, rulebook and the current realities, members should be open to discussing those issues and I would assist members to have discussions in an open, transparent and inclusive manner. So, state capitalism, whatever measures are related to state capitalism, we have to look at the measures themselves and find the relevant rules at the WTO.

And second issue is the Asian economies, or the FTA’s bilateral or plurilateral FTAs. Yes, as you mentioned, there have been a lot of bilateral and – well, plurilateral regional trade agreements going on at the – in the Asian region and, of course, that is not the best way to pursue liberalisation. We all understand that multilateral forum is the best to pursue trade liberalisation. But given the reality that we have not produced any major trade agreements for the last 25 years, this might be some response in reaction to the lack of progress at the WTO. And in that situation, these FTAs and also, plurilateral trade agreements could serve as a building block and steppingstone to multilateral trading system, because, basically, it increases trade liberalisation among the members. And in some FTAs, they introduced some new rules that are not reflected in the WTO. So, they could fill in the normative gaps in the WTO, like the eCommerce rules are now introduced in a lot of recent FTAs.

So, what’s most important is to make sure that these FTAs should be consistent with the WTO rule. They should not raise barriers to others, and they should lower down barriers and liberalise trade among themselves. And we have a committee at the WTO, Committee on Regional Trade Agreements, and I would strengthen the committee activities, so that they could enhance the transparency of the FTAs and, also, they could provide the relevant information on the FTAs to members. Thank you.

Dr John Nilsson-Wright

Minister, you’ve been extraordinarily generous with your time, but I’m afraid we are out of time. First of all, I want to apologise to our audience, who have not had their questions answers, but – because of constraints of time, but Minister, you have been, as I say, very generous and thank you for your very comprehensive and detailed responses to these important questions. It’s been our pleasure to host you and, obviously, we wish you well with your candidacy and we are grateful for having had this opportunity to have such an informed and illuminating discussion. But I now, unfortunately, have to bring our proceedings to an end, but thank you, Minister, and thank you, the audience, for joining us today. This brings the end to our webinar. Thank you very much.

Minister Myung-Hee Yoo

Thank you very much. Thank you very much for all the questions and, also, for giving me the opportunity to share my views. It was a great pleasure.

Dr John Nilsson-Wright

Thank you, Minister, goodbye.

Minister Myung-Hee Yoo

Thank you.