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Candidates prepare for race to succeed Lamy as head of WTO

by fwire  Sep 4, 2012 23:00 IST

#India   #Latin America   #NewsTracker  

GENEVA (Reuters) - Candidates to replace Pascal Lamy as head of the World Trade Organization when the Frenchman steps down in a year's time are warming up for a contest that looks likely to become another round of international horse trading.

Emerging market countries will want to see one of their own in charge of the Geneva-based trading club, after the top jobs at the International Monetary Fund and the World Bank went to a European and an American.

But there are already signs that developing nations will squabble over the identity of their candidate, meaning the race for the job overseeing negotiations to reform global farm subsidies, customs and trading rules is wide open.

"It's a multi-dimensional chess game," said one ambassador to the WTO. "As in any election, you have to choose the best moment to put your cards on the table."

Lamy's tenure at the WTO has been marked by Russia's accession last month, and disputes, notably a trans-Atlantic row over aircraft subsidies between Boeing (BA.N) and Airbus. But most of all, it has been overshadowed by the failure to agree on any reform of the world trade rules.

Whoever succeeds him will find unfinished negotiations over trade liberalisation and competing claims from different regional and economic blocs about what the next steps should be.

Reviving the Doha round of trade talks risks getting bogged down in old arguments and driving the WTO into obsolescence but a bold bid to shake things up is bound to be divisive.

The job is tough because, beyond shaping the agenda and cajoling and persuading, the Director General has few powers with which to steer the 157 members of the global trade club.

Formal nominations are not due until December, but trade diplomats are already assessing chances and gathering names.

"It's very early days. We look forward to a competitive process with a slate of very good candidates," said the WTO's chief spokesman Keith Rockwell.

So far, only two have said they want the job.

One is New Zealand's Trade Minister Tim Groser, who starts with a double disadvantage: most diplomats say it is the "developing countries' turn", and New Zealand has already held the job once in the WTO's 17 year history.

One trade negotiator said it would be "very peculiar" for two of the WTO's first six chiefs to come from the same small, rich country.

Another said he regularly met Groser and said he was "very down to earth. But another New Zealander? I don't think so."

AFRICA'S TURN?

The other name in the hat is Ghana's former trade minister Alan Kyerematen, whose candidacy was approved without fanfare by the African Union (AU) at a meeting in Addis Ababa in July, which Lamy also attended.

Trade diplomats say that Lamy's replacement should be African, Latin American or Caribbean, while Asia is seen to be well-represented in world trade already thanks to the export strength of China, India and Japan.

So an African unity candidate would be one to beat. No previous candidate has managed to get the AU's backing.

"If he gets 54 African countries to start in his corner, then that's big," said one trade official in Geneva.

But senior officials from other countries that could join the race were dismissive and angry at what one called Ghana's attempt to "pre-empt" the contest.

"One would have expected that the AU would have looked at the totality of African candidates and who would have been best to build a candidature around," said one source. "I'm not even sure if some members of the AU candidature committee are members of the WTO."

Several sources said the AU's approval of Kyerematen was part of a deal to allow Nkosazana Dlamini-Zuma, a South African Minister and ex-wife of President Jacob Zuma, to win election to the chair of the AU.

"So there was this agreement to nominate this Ghanaian minister as the candidate from Africa," said one WTO diplomat. "From what I've heard, as soon as the meeting was over, others said 'No way'."

"DEAD ON ARRIVAL"

If there was such a deal, it still may not protect Kyerematen from a South African challenge. Zuma's Trade Minister Rob Davies has been approached by others wanting him to run, although South Africa has not yet decided whether to put forward a candidate, Davies' spokesman Sidwell Medupe said.

"That depends on the outcome of discussions within our own country as well as with others," Medupe said in emailed replies to Reuters questions. Asked if South Africa would back Kyerematen, he said: "We are assessing that."

However, Geneva-based diplomats bristled at the idea of Davies as the next head of the WTO.

"We accept that this is a good candidacy," said one trade negotiator. "The problem with Rob is that he's at one end of the spectrum. He's very negative with ideas of negotiating anything."

"He would be dead on arrival," said another. "I would like to see the Americans agreeing to him being the Director General. He's a hardliner. One of the main obstructionists, according to the U.S. and the Europeans."

He added that Davies' potential candidacy may also be an attempt to secure another Geneva post - as head of the U.N. Conference on Trade and Development (UNCTAD), currently run by Supachai Panitchpakdi, himself a former WTO Director General.

"I know for a fact that Rob has been in some way trying to ask people to support him to be secretary general of UNCTAD. If Africa gets the UNCTAD job, it's Latin America at the WTO," he said.

Kyerematen could also face a strong challenge from Nigeria, Africa's second-biggest economy and top oil producer.

Trade Minister Olusegun Aganga was said to have made his interest in the job known when he chaired the WTO's ministerial conference last December, but several trade officials said Finance Minister Ngozi Okonjo-Iweala, who missed out on the top top job at the World Bank earlier this year, was now likely to be Nigeria's candidate.

"She seems to be pretty good, willing and available," said one.

Her office did not reply to a request for comment.

"I can't confirm this because the process has not started," said one Nigerian official.

NOT ANOTHER MINISTER

Kyerematen can expect to face at least one rival from Latin America. The most talked about name in Geneva is Brazil's much-admired Ambassador to the WTO Roberto Azevedo. He was on holiday this week and not available to comment on any potential bid but a Brazilian trade source said his government was aware that he had been approached by different delegations in Geneva.

"As far as I understand they're thinking about it but there's no decision about whether Brazil will submit a candidate or not," the source said. "I don't think they're thinking about anybody else."

Despite the high regard of his peers, Azevedo's weakness is that he lacks the ministerial status widely seen as necessary to succeed Lamy, a former European Union Trade Commissioner.

"At the end, if it was Tim versus Roberto, Tim would win," said one trade negotiator. But he said that many of his fellow diplomats would prefer not to have an ex-minister in the job.

"They blame Lamy because he's tried to solve things at the level of head of state or at least minister. He always calls ministers and presidents and prime ministers and so forth and people say that's why the (Doha) round has not succeeded."

THE SOLIDARITY MYTH

If Azevedo does enter the race, he may also feel the need to tread carefully because Brazil is widely blamed for splitting the Latin American support in 2005, when his predecessor Luiz Felipe Seixas Correa ruined the chances of Uruguay's Carlos Perez del Castillo, enabling Lamy to sprint through the middle.

No Latin American candidate has yet emerged. One that many trade diplomats long to see enter the contest is former Mexican President Ernesto Zedillo. But he declined to enter the last WTO race and is now at Yale University in the United States.

"I can tell you he would not be interested in being Director General of the World Trade Organization," one Latin American diplomat said.

Any Mexican candidate would be handicapped becase another Mexican, Angel Gurria, already heads the OECD, and leading both bodies would widely be seen as wielding too much influence.

Zedillo may also be embroiled in a court case in Connecticut, where 10 Mexican Indians are seeking $50 million and a declaration of guilt against him for alleged war crimes, the Economist magazine reported this week.

Costa Rica's Trade Minister Anabel Gonzalez is also a potential candidate who campaigned to succeed Lamy at the WTO's December meeting, sources said.

She knows the WTO well, having headed the agriculture division in the WTO bureaucracy, but her tenure was divisive due to personal tensions between Pascal Lamy and Crawford Falconer, former chair of the Doha round agriculture negotiations.

Much rests on the ability of developing countries to unite behind one candidate, having failed to do so last time and subsequently watched Nigeria and Colombian candidates lose the top job at the World Bank to Korean-born American Jim Yong Kim.

"This developing country solidarity thing is very often a myth," said one source. "There's a concern that one might balance the other one out. This all starts to push the whole thing in the direction of Groser."

(Editing by Stephanie Nebehay and Anna Willard)