Key facts
- Japan has proposed reforms to the World Trade Organization.
- The proposals include altering the WTO's unanimous decision-making rule for specific multiparty agreements.
- WTO Director-General Ngozi Okonjo-Iweala supports Japan's initiative in reforming WTO rules.
- Okonjo-Iweala suggested that plurilateral agreements, negotiated by a subset of countries, will become more prevalent.
- Japan is encouraging other WTO members to join a moratorium extension for e-commerce levies.
Japan has put forward a set of reform proposals to the World Trade Organization (WTO) aimed at overcoming the body's current dysfunction. Among the key proposals is a change to the rule requiring unanimous decisions, which Japan hopes will facilitate agreements among a subset of member states. WTO Director-General Ngozi Okonjo-Iweala has encouraged Japan to take the lead in these reforms, stating that the organization needs to be "fit for the 21st century."
Okonjo-Iweala noted that reaching consensus among all 166 WTO member economies is increasingly challenging. She suggested that "plurilateral" agreements, negotiated by like-minded countries and later opened to others, are becoming the "new way of doing business" at the WTO. This approach could be used alongside the consensus principle for global issues like measures against infectious diseases.
While a WTO ministerial meeting in Cameroon failed to reach a consensus on extending tariff exemptions for e-commerce, a group of countries, co-chaired by Japan, did agree on a moratorium extension and are encouraging broader adoption. Okonjo-Iweala expressed disappointment over the lack of a comprehensive agreement but indicated that efforts are ongoing.
The WTO Director-General also highlighted significant global trade disruptions, including surging crude oil prices due to the war in Iran and tariffs imposed by U.S. President Donald Trump. Despite these challenges, global goods trade saw a 4.6% increase in 2025, exceeding initial expectations, which Okonjo-Iweala attributed partly to demand ahead of tariffs and trade in AI-related goods.