Where does the reform of the World Trade Organization go when the logic of globalization changes

On the eve of the 14th Ministerial Conference of the World Trade Organization (WTO) in 2026, an internal evaluation document written by Peter Elberg, Norway's Permanent Representative to the WTO and coordinator of the reform agenda, was leaked, making a cautious judgment on the prospects of WTO reform: preliminary discussions have been held on some issues, but in key areas such as decision-making mechanisms, dispute settlement, and rule application, the positions of members are still highly dispersed and far from forming a consensus that can support a "package of institutional reforms". The document predicts that this ministerial meeting is more likely to focus on establishing a roadmap for subsequent reforms rather than achieving binding substantive results.

Behind this cautious expectation is a deep crisis that the WTO is currently experiencing. And the trigger comes precisely from one of its core principles.

At the time of the disclosure of the document, the United States proposed to all members that WTO reform should re-examine the principle of "most favored nation treatment". According to this principle, any trade preference granted by a member to another member must be unconditionally and automatically applied to all other members. Since the establishment of the WTO in 1995, "most favored nation treatment" has been the institutional cornerstone of the "non discrimination" spirit of the multilateral trading system. Although the US has not formally proposed amending the agreement text, simply including it in the reform discussion is enough to shake the entire system.

After all, the legitimacy of the WTO is built on three pillars: universal participation and consensus in procedures, trade growth and welfare enhancement in outcomes, and non discrimination and predictability in rules. Once the "most favored nation treatment" is conditioned, differentiated, or even partially shelved, the logical foundation of the entire multilateral framework will face reconstruction.

Structural cracks in members' demands

The reason why WTO reform is struggling is rooted in the profound transformation of the logic of globalization itself.

At the beginning of its establishment, the core of WTO negotiations was tariff reduction and market access. These fields are highly technical and have clear boundaries of interests, and all parties can negotiate around the "how much profit to give". But with the significant decrease in global average tariffs, the focus of competition has already shifted to more sensitive areas: industrial subsidies, technology standards, cross-border data flows, government procurement, and even domestic industrial policies themselves. These issues are no longer just "foreign trade issues", but are directly embedded in the core of various economic governance, affecting employment structure, regional development, and even the nerves of political parties.

At the same time, the global economic power structure is undergoing drastic changes. When the WTO was established, emerging economies represented by the BRICS countries accounted for less than 10% of global trade in goods; Now it has risen to nearly 20%, becoming a key engine driving global trade growth. As some developing countries shift from being "rule receivers" to "rule shapers", the implicit structure of interest distribution in the old negotiation mechanism is becoming unsustainable.

Developed countries emphasize "rule equivalence" and demand that emerging economies assume more obligations; Developing countries adhere to "special and differential treatment" and defend policy space and development rights. Both sides are pulling under the same roof of the system, but it is becoming increasingly difficult to find a common language. The controversy surrounding "most favored nation treatment" is precisely the focal point of this structural tension.

Unilateralism is on the rise, putting pressure on multilateral mechanisms

Even more severe is the external environment. Since 2025, the United States has implemented a "reciprocal tariff" policy, frequently resorting to unilateral measures and bilateral negotiations, driving major economies to rely heavily on exclusive trade arrangements. The trend of anti globalization is resurfacing, and the global supply chain is accelerating regionalization and factionalization. The "universal rules+non discrimination" model relied on by the WTO is being continuously eroded by fragmented "small circle agreements".

In this context, it is almost impossible for the WTO to complete institutional restructuring through a ministerial meeting in the short term. A more realistic path may be gradual adjustment and multi track parallelism: while maintaining the nominal integrity of core principles (such as "most favored nation treatment"), limited breakthroughs can be achieved on specific issues through plurilateral agreements, flexible commitments, or "open plurilateral" approaches.

But this itself is also a difficult balancing act, which needs to prevent the complete hollowing out of the multilateral system and respond to the urgent need for flexibility among members. The WTO is no longer just facing technical repairs, but how to prove that multilateralism still works in an increasingly divided world.

History has endowed the WTO with glory: it was once an institutional symbol of the golden age of globalization. But now, it must regain trust in an era that no longer believes in "win-win". The ministerial conference in 2026 may not bring an answer, but at least it will reveal whether the world is still willing to leave a light on the multilateral trade order.

(The author is a researcher at the Institute of Asian and African Studies, University of London)