The upcoming G20 summit in Osaka to be held on June 28-29 will be a platform for discussing the most pressing international trade and economic issues, such as the trade war between the US and China, as well as the reform of the World Trade Organization (WTO), Professor, Director of the Center for International Economics, Keio University of Economic Research in Japan Fukunari Kimura said.
According to the special correspondent of the Report dispatched to Tokyo that Kimura believes that if the trade war between the two largest economies lasts for a relatively long time, generally it will lead to "not very positive consequences" for other countries. According to him, during the battle of the two largest economies, it is quite problematic for other countries to intervene.
"Moreover, the G20 can have a positive impact as a platform for dialogue. The summit will unlikely be a place for active discussions, however, we can expect a number of important meetings during the summit, where these issues will be discussed," the expert believes.
According to him, the United States violates its WTO commitments, by applying the policy of imposing duties on a number of countries, as well as block the appointment of new judges to the WTO Appellate Body.
There are seven arbitrators in the WTO Appellate body, which deals with all complaints of the member countries. And every year some of them have to be re-elected. Currently, instead of seven, there are only three active judges in the organization, who have the right to consider trade disputes. This is the minimum quorum, which generally has the right to consider any litigation. Moreover, the term office of two out of three arbitrators is completed this year. Thus, if they are not replaced by new ones, the consideration of contentious cases in the WTO can be completely suspended at the beginning of 2020.
As the expert noted, in case of the worst scenario, such blocking of activity of a WTO structure, which is responsible for the resolution of controversial issues, casts doubt about the future of this organization as a whole.
According to him, the WTO is a kind of guarantee in world trade, for example, issue of setting tariffs, and the loss of the WTO will be most noticeable for developing countries: "[Preserving the WTO], we will thus preserve the system. Currently, the situation is extremely dangerous. The United States is one of the countries that uses the WTO, including its dispute resolving structure."