CUTS Daily Bulletin # 01 | September 15, 2026
Session 1: Trade and Cooperation for the Future”
WTO Public Forum 2026 – Opening Plenary
 
The opening plenary of the 2026 WTO Public Forum examined how trade and multilateral cooperation can respond to a period of geopolitical tension, economic uncertainty and rapid technological change. Although the speakers recognised serious weaknesses in the current trading system, the overall tone was constructive: the WTO should not be abandoned, but reformed so that it becomes more responsive, inclusive and capable of producing practical results.

A central theme was the relationship between trade, peace and certainty. Speakers argued that peace should be understood not only as the absence of armed conflict, but also as a stable and predictable environment in which firms, workers and governments can plan for the future. Trade rules help provide this certainty by reducing arbitrary discrimination and encouraging investment. They referred to estimates that trade-policy uncertainty had cost the global economy roughly US$250bn in lost economic activity in 2025 and could cost about US$600bn in 2026. These figures illustrate that policy volatility is not an abstract diplomatic problem; it has direct consequences for growth, employment and development.

WTO DG Ngozi Okonjo-Iweala connected peace and development even more explicitly. Development requires peace, while lasting peace is difficult to achieve without economic opportunity. She defended the contribution of the postwar trading system to interdependence and growth, while acknowledging that globalisation has also produced vulnerabilities. Excessive dependence on particular suppliers, markets or countries can create strategic risks, especially when geopolitical tensions affect supply chains. The challenge, therefore, is not simply to increase trade, but to make the trading system more resilient and diversified without turning economic policy into a source of further fragmentation.

The speakers also called for a change in the way WTO reform is discussed. They were critical of the tendency to repeat familiar diagnoses of institutional deadlock without moving towards solutions. The WTO community must listen more carefully, learn from experience and use the institution’s existing strengths rather than constantly relitigating past disputes. This implies a shift from crisis management to implementation: members should identify areas where cooperation is possible and develop concrete outcomes, even while larger disagreements remain unresolved.

One important proposal concerned plurilateral cooperation, described in the panel as a system of ‘pathfinders’. The WTO’s consensus-based structure remains important for legitimacy and inclusiveness, but consensus can also prevent progress when a small number of members oppose new initiatives. Willing members could therefore advance agreements in selected areas, provided that these arrangements remain compatible with core WTO principles, including non-discrimination, most-favoured-nation (MFN) treatment, national treatment and transparency. Plurilateral initiatives must be carefully designed so that they do not create exclusive clubs or undermine the wider multilateral system. The underlying objective is to reconcile universality with agility: preserve a common framework while allowing members to move ahead where agreement is possible.

Sustainable development was presented as another potential basis for renewed cooperation. Speakers argued that sustainability is already part of the WTO’s founding purpose and should become more central to its future work. Possible areas include implementing the Fisheries Subsidies Agreement, reforming fossil-fuel subsidies, coordinating green industrial policies and improving the compatibility of carbon-border measures. Trade in environmental goods and services, as well as trade-related support for climate adaptation, could generate practical cooperation between economies with otherwise divergent interests. Climate policy is, therefore, not only an environmental issue; it is also a field in which trade rules can either reduce friction or help build common solutions.

Finally, the panel stressed that the global economy has changed faster than the WTO rulebook. The system was largely designed around manufacturing and physical goods, whereas contemporary commerce increasingly involves services, digital delivery, data and artificial intelligence. At the same time, South-South trade has expanded significantly, with Global South economies accounting for approximately 45 percent of world trade. The WTO must consequently respond to a more multipolar economy, new forms of industrial policy and changing patterns of economic power.

The session’s broad policy message was therefore one of pragmatic renewal. The existing WTO system continues to provide valuable predictability: according to figures cited during the discussion, around 72 percent of world trade still takes place on most-favoured-nation terms. A collapse of the multilateral framework would impose especially serious costs on developing regions. Yet preservation alone is insufficient. WTO members need to reform dispute settlement, enable carefully governed pathfinder initiatives, place development at the centre of negotiations and use climate and digital issues to produce new forms of cooperation. The future of the trading system will depend on whether it can remain open and legitimate while becoming faster, more flexible and better aligned with the realities of the twenty-first-century economy.

Key takeaway: The panel framed the future of the WTO as a balance between preserving universal rules and enabling faster, practical cooperation in areas, such as digital trade, artificial intelligence, climate policy and development.

Speakers
Dr. Ngozi Okonjo-Iweala, Director General, WTO
John Denton, Secretary General, International Chamber of Commerce (ICC)
Patricia Fuller, President and CEO, International Institute for Sustainable Development (IISD)
Amb. Guilherme Patriota, Ambassador of Brazil to the WTO & Chair, WTO Dispute Settlement Body
Inu Manak, Senior Fellow, Peterson Institute for International Economics (PIIE)
 
Session 2: Launch of the World Trade Report 2026
 
The 2026 World Trade Report offers a rigorous diagnostic of the GATT/WTO system, assessing what has worked, what is under strain, and where reform is feasible. Since 1995, world trade has expanded manifold, enabling many developing countries to integrate into the global economy and helping the system withstand multiple financial and economic shocks. However, the report underscores growing unease about the WTO’s capacity to respond decisively to contemporary challenges. It warns that geopolitical fragmentation could reduce global gross domestic product (GDP) by up to five percent, with further losses if the multilateral trading system (MTS) is not reformed.

The Report team frame the core task as repairing what is broken and updating what remains redeemable. Despite its difficulties, the WTO remains resilient: MFN-based trade in goods still accounts for roughly 72 percent of global trade. The report cautions that failure of the MTS could lead to more dangerous scenarios: (i) fragmentation along geopolitical blocs, and (ii) fragmentation into competing FTA-based spheres. Smaller and poorer economies would be most vulnerable in both scenarios due to reduced predictability and higher transaction costs.

The report identifies four structural challenges:
  1. Changing distribution of economic power – WTO rules and disciplines still reflect an outdated balance of power.
  2. Rise and scale of government interventions – industrial policy, subsidies, and state-led strategies are now central to economic strategies.
  3. Changing nature of trade – while tariffs remain relevant, “behind‑the‑border” measures, services, digital trade, and environmental policies now dominate the trade narrative, complicating cooperation.
  4. Geopolitics and economic security – governments increasingly frame trade issues through national security lenses, demanding greater policy flexibility and dynamism.
Key Themes from Panel Discussions

Changing Economic Power, Development, and Bargaining Dynamics
Panellists noted that the global economic landscape has shifted fundamentally since the WTO’s founding. Developing countries now account for around 40 percent of global trade and constitute a larger share of membership, but they are highly heterogeneous. This diversity complicates rule-making and the calibration of rights and obligations.

While reforms are possible, there is strong emphasis on preserving Special and Differential Treatment (S&DT). Concepts such as reciprocity and non-discrimination, easier to operationalise three decades ago, are harder to apply in a context of complex industrial, environmental, and digital policies. Many developing countries caution against “over‑reform,” arguing that a well-functioning MTS can still deliver development gains if implemented effectively.

Industrial Policy, Subsidies, and Divergent Economic Models
In 1995, there was broad consensus on market-led growth; today, there are divergent views on the role of the state. A central reform challenge is enabling different economic models to coexist within a rules-based system.

From a business perspective, the priority is transparency: improved notifications and early-warning mechanisms on industrial policy measures and subsidies. Rather than abstract debates, stakeholders call for practical tools to measure and monitor such measures, assess cross-border spillovers, and identify trade-distortive effects. Governments, in turn, must balance economic realities with domestic political constraints when designing and notifying interventions.

Plurilateralism and the Consensus Challenge
Businesses stress the need for a transparent and predictable trading environment. Given the difficulty of securing consensus among 166 members, plurilateral agreements are seen as essential complements to the multilateral framework.

The concern is not plurilaterals per se, but the risk that they could entrench permanent advantages for a few. Panelists argued that plurilaterals with clear guardrails, open accession, and MFN-based benefits can mitigate fragmentation risks. Enhanced transparency, flexibility, and notification requirements are viewed as key to making plurilateral approaches compatible with the broader MTS.

Economic Security and the Limits of WTO Law
A critical question is whether the existing WTO legal architecture can still regulate the boundaries of global economic governance, or whether substantive reforms are required. When measures are justified on national security grounds, demands for transparency and accountability can appear contradictory to stated security objectives.

The challenge is to develop rules that bring formerly exceptional areas — such as industrial policy and security-related measures — within a more structured, predictable framework. This would involve clarifying the scope of security exceptions, strengthening notification and consultation practices, and designing disciplines that respect legitimate security concerns while limiting protectionist abuse.

Overall Implication
The 2026 World Trade Report presents the MTS as stressed but salvageable. The priority is not to dismantle the system but to adapt its rules and processes to new economic realities: shifting power dynamics, expanded state intervention, evolving trade patterns, and heightened geopolitical competition. Reforms that enhance transparency, accommodate diverse economic models, and carefully integrate plurilateral initiatives could help preserve the core benefits of the WTO while reducing the risks of fragmentation.
 
Speakers
Dr. Ngozi Okonjo-Iweala, Director General, WTO
Dr. Robert Staiger, Chief Economist WTO
Dr. Pinelope Goldberg, Professor, Yale University
Amb. Kumar Iyer, Ambassador of UK to the WTO
Dr. Mona Paulsen, Professor, London School of Economics
Amb. Manuel Teehankee, Ambassador of the Philippines
Andrew Wilson, Deputy Secretary General (Policy) and Global Policy Director, ICC
Session 3: The Future of Services Trade — A Business Leaders' Dialogue
 
This session organised by the Global Services Coalition (GSC), brought together CEOs and senior executives from leading services companies to discuss the trajectory of international services trade over the next decade, covering emerging trends, technological change, regulatory challenges, and the WTO's role in supporting open and inclusive services trade.
  1. Digital and AI-Driven Growth in Services: Microsoft's growth is grounded in security/trust, an integrated tech stack (cloud, AI, productivity tools), and global infrastructure investment. Digital and AI-enabled services demand is growing at double-digit rates, with 48 percent of Microsoft's services revenue now from outside the US.
  2. Rising Complexity in Regulations: Unlike 20 years ago, when goods movement was the main challenge, today's difficulty lies in unpredictability at the point of execution - now roughly 25 percent of global trade, the highest share on record. Transparency, predictability, and harmonisation were cited as prerequisites for growth.
  3. Cross-Border Healthcare Innovation Outpacing Regulation: IHH Healthcare's panelist described AI and telehealth already enabling cross-border care — patients using AI to find treatment and consulting doctors via WhatsApp, pathologists consulting counterparts abroad — despite this remaining largely unregulated, with barriers around licensing, medical record portability, and medical tourism.
  4. Data Localisation, Sovereignty, and Trust: Rising data localisation was linked to digital sovereignty concerns, AI/semiconductor geopolitical competition, and distrust between governments. Microsoft's panelist warned excluding foreign providers without workable alternatives risks fragmenting infrastructure rather than resolving sovereignty concerns.
  5. Sustainability Disclosure as a Data Flow Driver: CDP's panelist explained standardised sustainability data demand (resilience, water/land use, emissions) drives cross-border data flows, but unharmonised disclosure frameworks make comparability difficult and increase reporting burden without improving outcomes.
  6. AI as a General-Purpose Technology: AI was framed as comparable to the internet, with potential to transform all sectors. Success was tied to five conditions: cloud infrastructure, AI/digital skills, broad access to benefits, trust and security, and global openness/collaboration.
  7. The E-Commerce Moratorium and WTO Modernisation: Concern was raised over the lapsed multilateral e-commerce moratorium — a permanent moratorium was envisioned for the WTO to advance its digital agenda, alongside modernising services rules unchanged in 29 years and addressing unequal AI diffusion across the Global South.
  8. A Call for Incremental, Achievable Action: The DHL panelist urged pursuing achievable, incremental wins across the WTO's members rather than getting stuck on scale. Regulatory complexity was noted to disproportionately burden Micro, Small, and Medium Enterprises (MSMEs). The WTO is pushed to take on multifaceted roles in this issue.
Speakers
John Ferguson, Global Head of Trade and Geopolitics, Economist Enterprise
Hennie Heymans, CEO, DHL Express, Sub-Sahara Africa
Dr. Prem Kumar Nair, Group CEO, IHH Healthcare
Sherry Madera, CEO, Carbon Disclosure Project
Sarah O'Hare O'Neal, Vice President, Global Trade, Microsoft
Session 4: The Tectonic Plates of Trade Are Moving — A New Equilibrium?
 
This session, led by the PIIE, traced the shift from 1990s-era optimism around globalisation — fueled by the fall of the Berlin Wall and China's 2001 WTO accession — to today's more fragmented equilibrium, marked by US withdrawal from multilateral commitments, rising protectionism, and trade policy now weighing security and industrial policy alongside economic opportunity. 
  1. Vision for a Rules-Based Equilibrium: Global GDP has grown sevenfold and trade fiftyfold since the WTO's founding, with China's 25 years of membership and Regional Comprehensive Economic Partnership cited as evidence that the system works. The US stepping back was framed as a "golden opportunity" for China — pointing to its continued GDP contribution, job-creating investment abroad, and its move to reduce tariffs to zero for 70 countries. There is an emphasis to refocus on nondiscrimination and transparency, and real reform is urged — stressing a rules-based, not power-based, system to avoid fragmenting the Global South.
  2. The US View — An Economy in Disequilibrium: The US trade position was described as bipartisan in its underlying direction (from North American Free Trade Agreement through WTO entry to the Trump administration), driven by a recognition that the US economy itself has developed unsustainable imbalances over time as a result of past policy choices.
  3. The EU's Balancing Act Between the US and China: The EU is actively avoiding being squeezed between the US and China by pursuing new bilateral trade ties with India, Indonesia, Australia, Canada, Mexico, Vietnam, and Japan, while pushing for trade that remains transparent and rules-based, even as it manages friction from US tariffs and anti-dumping and industrial policy disputes with China.
  4. The Global South's Push for Diversification: On Brazil’s position, speakers said that these countries do not wish to take sides between major powers and instead want an active, functional WTO. They framed diversification and flexibility as key to moving forward. With the US stepping back, the question of whether the EU, China, or a broader "coalition of the willing" should fill the leadership gap was raised, where panelists called for greater transparency in decision-making, unified global rules, and more regular engagement from trade ministers.
  5. Avoiding Geopolitical Hijacking of Trade: The Chinese position cautioned against letting geopolitical tension override economic relationships, urging the EU not to simply follow US policy shifts, and pointed to Canada's approach of sustained peaceful dialogue as a model for managing disputes without letting them escalate into broader conflict.
  6. Structural Shifts in Reliability and Concentration Risk: It is argued that neoliberal economists underestimated the risk of over-concentration on single-country dependencies. The shift reflects not just elite bipartisan consensus but public sentiment — given how few countries have retaliated against recent US tariffs — and that future US trade commitments can no longer be relied upon with the same confidence as in the past.
Speakers
Dr. Adam Posen, President, PIIE
Brendan Murray, Journalist, Bloomberg
Dr. Cecilia Malmstrom, Fellow, PIIE
Dr. Tatiana Prazeres, Foreign Trade Secretary, Brazil
Joe W. Sullivan, Senior Director for policy, United States Trade Representative (USTR)
Huiyao. (Henry) Wang, Founder and President, Centre for China and Globalisation
 
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