Legendary Liberia Accession – A Model At WTO
Geneva – Last December, World Trade Organization (WTO) Ministers convening at the Tenth Ministerial Conference in Nairobi, formally approved Liberia’s WTO membership. What does it all mean for the future of trade in Liberia, a post-war nation on the mends and recovering from the devastating impact of the deadly Ebola virus outbreak.
“We have now worked out a package called the post-accession plan which provides a platform to help Liberia not only implement its obligations and commitment but also to begin to maximize and reap the rewards and benefits from its accession package” Mr. Chiedu Osakwe, Director of Accession, World Trade Organization (WTO)
The Office of Accession headed by Mr. Chiedu Osakwe, was critical to Liberia’s accession process.
Prior to joining the WTO Secretariat, Mr. Osakwe, was a Nigerian Foreign Service Officer (1979-1998). In this period, he served at the Permanent Missions of Nigeria to the United Nations in New York (1983-1986) and to the GATT/WTO (1993‑1998).
As Nigerian Delegate to the WTO, he was Chairman of the Committee on Rules of Origin (1995 and 1996) and Chairman of the Committee on Pre-Shipment Inspection (1997/98). He coordinated the WTO African Group in 1995.
Mr. Osakwe was educated at the Universities of Ibadan, and New York University (NYU), from where he obtained his PhD. He has published in several areas, including trade policy, the rule of law and nation. He told FrontPageAfrica in an exclusive interview at his office in Geneva last week that the approval is only the beginning of what should be giant leap for Liberia’s trade aspirations.
FRONTPAGAFRICA: Let’s start with the issue of Ethiopia. Why is it taking so long for them to gain WTO Accession?
CHIEDU OSAKWE: It is a simple question. There are economies like that of Ethiopia where they prefer to sequence their domestic reforms. The Ethiopian government wants to accede to the WTO. WTO membership remains a priority for the government of Ethiopia. It was a priority for the late Prime Minister, it is a priority for the current Prime Minister.
Our Director General Roberto Azevêdo of Brazil, has met with the Prime Minister, the current Prime Minister, several times. He’s been to Ethiopia. I myself I met with the Ethiopian ambassador, it was just on Friday last week, just on Friday last week.
The attachment and commitment of acceding to the rules-based trading system is totally undiminished. However, Ethiopia is governed by a very disciplined leadership; they are working to a development plan that you probably know about. Their development plans are structured based on a periodicity of every five years and those development plans are yielding results; they are.
As you may know from the GDP statistics, Ethiopia is one of the ten economies in the world that are growing at the fastest rate. So in their own calculations and their own domestic priorities, they have decided that there are things that they want to do first before they do other things; and so they are domestically – you can ask me, lot of it is headline – public domain news. They are focussed on building as you know, one of the biggest dam projects in the world, for the supply of energy. In fact not only will that dam meet domestic energy needs, they will be able to supply and export energy to other parts of Africa.
They are developing several of the small and medium enterprises. It is a calculation that the government has made. They have repeated as I said that they are committed to membership of the WTO of which as you know the core values are the values – the values of the market economy, the rule of law, transparency, good governance. But they have decided to do some of the prudential, take some of the prudential measures they need to take domestically not only in the area of goods merchandise but also the area of service so that when they accede on day one, they will be able to meet their membership obligations.
FRONTPAGEAFRICA: So you are saying that they’re setting up the structures and not necessarily being cautious about the ramifications of opening up the economy?
CHIEDU OSAKWE: There is caution. You have this caution on the part of those that are already WTO members, those already inside the system. There is always caution and prudence and the management of economic of economic affairs in a global economy that is interdependent, largely becoming digitized and the rapid transformation. There is uncertainty, there are shifts in the global balance of economic power. Things are not as certain and as precise as they used to be. How can anybody say that you are wrong, you are absolutely right. I used the word absolutely, there is caution, there is prudence and my sense, as I said, look as an international civil servant I will not sit in judgement on decisions by governments regarding one’s substance, process and procedure.
These are sovereign governments. They will do what they know they have to do when they are prepared to do it based on a complex and a lot of variables. It is a global economy into which they are willing to integrate, that’s inevitable, no country can set itself aside from the global economy. But also those domestic factors getting a bye and dealing with different constituencies and vested interests, civil society, a huge range of considerations.
And it’s not only in Ethiopia but it’s in Nigeria, it’s in the United States, it’s in the European Union, it’s everywhere. There are ranges of considerations that managers of economic and trade policies have to take into account. In my sense it’s not useful in a process of domestic reforms to force the pace of governments, they will do it when they will do it and this is the only thing that ensures predictability and stability. And remember, it is a democracy and they are accountable to their constituencies, there are electoral processes and it’s the same for all countries. Judgmentalism is something that we banish from our system.
FRONTPAGEAFRICA: How long has this process been going on and when did they first apply to the WTO?
CHIEDU OSAKWE: Ethiopia’s process is now running well over ten years or a little bit longer. I can give you the precise date, the calendar date when we’re done. But it’s been running for a while but to put this time factor into perspective from the establishment of the WTO in 1995 to now, twenty-some-years period, we have had 55 applications and working parties. We have concluded 36 working parties, 19 remains in progress. There have each times to concluding either of the 36 that we’ve done is ten years, the average, some have done it quicker in the span of two years and nine months; China had fifteen, Russian Federation had 18, Kazakstan, basically, approximately 20. Algeria, not yet done – it’s in its 29th years. But I tell folks not to worry and not to be overly concerned with the lengths of time for ascension. Why not? Because it is a process of domestic reforms.
What does that entail? It entails the fact that there is a process of negotiations on the bilateral track between the exceeding governments and a member and any number of members that would want bilateral negotiations. Unilateral, multilateral negotiations, these are three tracks, but do you know the most challenging? The domestic track. One the negotiations internal to the exceeding government. Between different government departments, with vested interests, with industry, with civil society, with getting parliamentarians and institutional framework within the legislature either to enact new laws, promulgate implementing regulation, or undo and redo existing laws until they are WTO consistent. It is a process, it’s drawn out. Trade negotiations of which accession negotiations are very typical, it is not an abstract exercise. It is a negotiating exercise, it is a consensus building exercise within, with the neighbours external.
Take Liberia though, they undertook the fortress of negotiations including domestically and they had also to negotiate with membership of ECOWAS, a grouping to which they belong, to ensure not only with WTO consistency but ECOWAs consistency. One of the messages I would want to disseminate is that trade negotiations are pretty tough negotiations. It is not as imagined out there in headline news and public domain that you give a calendar and its done. There are no dossiers in negotiations. These are equivalent of rugby until an outcome is reached.
FRONTPAGEAFRICA: What was the process like for Liberia leading up to the decision of joining the WTO?
CHIEDU OSAKWE: If you ask me to identify for you what probably is the defining nature of the accession negotiations of Liberia which in many ways we had not seen in the WTO before, one was the leadership of the President Ellen Johnson-Sirleaf which was, outstanding. In the midst of the negotiations, if you like to use an expression in vogue, they were hit with the perfect storm. Remember this was a country that came out of a horrendous domestic conflict; the President was dealing with the process of stabilizing the country and unifying it and consolidating it, it does not happen overnight and then you had the public health tragedy of Ebola but what has made Liberia and exemplar for how to fight back; engage, was they did not withdraw or retreat from these challenges or wring their hands; they confronted their problems head on, they then challenged the international community here at the WTO to help them conclude their accession negotiations so that they can use the substance of success of the package and the process to mobilize the international community and to use their accession package in that regard as an anti-Ebola recovery strategy and as we commend President Ellen Johnson-Sirleaf, the role of our Director General was outstanding.
You know the reaction of individuals when there are difficulties and challenges especially with public health to use your famous words, concerns, caution, do you engage, do you not engage, do you meet with the negotiators do you not meet with them; the instruction that we got from Azevêdo, our director general was you work with the Liberians, you do what you have to do, you travel there when you must, you receive them when they come and the secretary of our working party, Dr. Juneyoung Lee, and her colleague, Anna Varyanik, co-secretary, worked around the clock.
You know what happened, they then set up a model that is now being called the Liberian model in the WTO accession negotiations, because the negotiations were basically done within nine months. We have never done anything like this before. So the leadership of the acceding government always matters; the leadership of the director general of the WTO and in many ways and my colleagues who worked around the clock and our members who supported the process. Now they have a package that Liberia. We have now worked out a package called the post-accession plan which provides a platform to help Liberia, not only implement its obligations and commitment but also to begin to maximize and reap the rewards and the benefits from its accession package.
FRONTPAGEAFRICA: What is the next step for Liberia, how does it capitalize on the gains of its accession?
CHIEDU OSAKWE: As you know, WTO accession is a law based and a road-driven process, the next step is for the legislature, the parliament in Liberia to ratify a protocol, it’s a jargon, protocol on the accession of Liberia. After they have ratified it – and they have to do that before the end of June, in fact before the middle of June, by the 15th of June they have to and after the parliament ratifies it, the President or the Foreign Minister will sign the instrument; it’s called, the instrument on the acceptance of the protocol of accession of the protocol of Liberia and it will be deposited here. And when it is deposited with the Director General who is the depository, we count from 30 days to zero and they become a member.
On day one of membership it will have obligations of things they have to notify and on that day also, the team here in the secretariat will begin to implement the post-accession plan for Liberia. The Liberians are keeping their own word domestically to be able to implement the post-accession plan, they have established the institutional framework for doing this, they have established a steering committee, a technical working group and a post-accession monitoring plan.
On this basis there are a number of meetings held, the team here will go to Liberia in early June, they will go to Liberia in June to have a post accession workshop and we don’t’ rest. We follow it up with a workshop on the margins of UNCTAD 14 in Nairobi, Kenya in July. So there is a lot that is going on. The Liberians are moving hard, rapidly, aggressively on the basis of a strong leadership of their President and the Director General of the WTO is giving us the staff all the support we need to do this.
FRONTPAGEAFRICA: Does the post-accession plan include exploring the best way possible Liberia can make use of its membership of the WTO, particularly the Aid for Trade incentives?
CHIEDU OSAKWE: Excellent! There’s nothing more to add to what you’ve said. It will be linked to Aid for Trade support, technical assistance, capacity building in both micro and macro forms. All these are words, but if you want examples, a priority for the government of Liberia, for the President, for the trade minster(Axel Addy) who was the chief negotiator, is to establish a single window, one-stop shop for the investors who will establish in Liberia.
The World Bank is working on this and is committed to delivering on this. I give you a second example, the International Trade Center, headed by Arancha González, they have developed a plan, in fact she chaired one of the workshops because we had an accession workshop for Afghanistan and Liberia in Nairobi on the margins of MC10. At ITC, they will be moving very aggressively to present a package to provide support for the private sector in Liberia as well as Afghanistan to draw up the benefits for their private sector, basically improving exports and identifying market-access opportunities. So it is very concrete.
FRONTPAGEAFRICA: Can Ethiopia access the same markets, does it have to join WTO to benefit from the same markets and opportunities that it presents?
CHIEDU OSAKWE: I can answer it in the specifics but the better way to do it is to put that question into context. The question in context is why do countries seek to accede to the WTO: Market access is one reason; it is one reason. When an economy like Ethiopia joins the WTO, it will not only have access to extraditional – there is an important distinction there, not only for its traditional markets that it currently, largely has access to on the basis of preference.
In other words, those markets opened for Ethiopia at this time, they can keep it open, they can close it whenever they want because it is preferential; and so the market access is discretionary. So in joining the WTO, what happens? An economy like Ethiopia gains market access beyond its traditional market access. On an MFN basis but more importantly, has security and predictability of market access, bigger than having market access as a non-member which can be taken away at any time and you won’t get a reason.
But that’s not the only reason and this is why it is important that you get this answer in context, that’s not the only reason that countries join and they join for a range of reasons. One reason that the 36 who have gone through this process-every single one of them, they say they joined so that they can become a member to an organization based on the rule of law, they care about the reputation of government’s and countries, they don’t want to be seen as outlaws, they don’t’ want to be seen outside of a low-governed economy. So they join for rule of law reasons and they are very clear about that.
Some others join because they need a multilateral platform for the domestic policies that they have to take any way. If you don’t reform, you fall behind, your neighbours and others get ahead of you, countries must be conformity to be competitive, to be efficient to be on par or better than their neighbours. It is a competitive world out there. They also joined for a range of reasons, some join to increase the chances of attracting investment, not only foreign but to lure the investors back home – So, to attract both foreign and domestic investors.
There is a whole range, a whole slew of reasons some join the WTO because they use it as an exercise of their leadership and to increase their regional standings. These are not reasons manufactured by the WTO but some join as a pre-emptive rule to protect themselves from economic attacks. In a world where there is an increasing resurgence of geopolitical conflicts and difficulties. So it is a whole range of reasons, it is not just market access: Woman does not live by bread or butter alone, it’s for a lot of reasons, you would agree, would you not?
FRONTPAGEAFRICA: So right now, Ethiopia only has access to the Least Develop Countries? What markets can they access now?
CHIEDU OSAKWE: Basically, the mean markets to which their exports go, their export destination, the European Union, the United States, Japan, China and they trade with their neighbours in the horn of Africa. But it’s not the totality of global market access, that’s the point. And most of the markets they currently access are based on preferential; it’s based on preferential market access.
FRONTPAGEAFRICA: If you could give one advice to countries that are looking to acceding to the WTO, what would that be?
CHIEDU OSAKWE: Get on with it, be ambitious, be aggressive. The longer you delay it, the harder it becomes. Why? Because you have more members who will come in before you and who will insist on negotiating the terms of your membership and you will have more roles because the global economy and the WTO is not standing still. We are members of the WTO negotiating new rules.
Before 2013 we did not have the Trade Facilitation Agreement, before this year, there was no acceding government that had to negotiate and include in the accession package, the Trade Facilitation Agreement. Now they have to. Before this year, no acceding government had to take on information technology to agreements, now they have to.
So economies don’t have a choice. If an economy stands still, even those that economists consider as the weakest and the most vulnerable will surpass, there’s no question. You have to keep circling in trade opening competitiveness and proven productivity and efficiency. Otherwise it becomes more difficult and it becomes worse, meaning what?
Demographics, populations grow, more graduates are coming into the job markets, they will look for jobs, welfare could increase, governments that are accountable, even those that are not as accountable or the most accountable, once you set an authority in government, you must deliver and there’s no way to do it except through reforms to continue increasing economic welfare.
Rodney D. Sieh, [email protected]