
<p id="h-topline"><strong>TOPLINE</strong> Nigerian economist Ngozi Okonjo-Iweala was appointed Monday as the director-general of the World Trade Organization, becoming the first woman and the first African national to lead the global trade body. </p>



<h3 class="wp-block-heading" id="h-key-facts">KEY FACTS</h3>



<ul><li>After growing up in Nigeria during the Biafran civil war, Okonjo-Iweala studied development economics at Harvard and earned a doctorate at the Massachusetts Institute of Technology.</li></ul>



<ul><li>She has made history throughout her career, becoming the first woman to serve as both the Nigerian finance minister in 2003 and foreign affairs minister in 2006.</li></ul>



<ul><li>Okonjo-Iweala was also the first woman to run for the presidency at the World Bank, where she spent more than two decades.</li></ul>



<h3 class="wp-block-heading" id="h-key-background">KEY BACKGROUND</h3>



<p>The appointment of Okonjo-Iweala clears a major administrative hurdle for the WTO, which has been without an official leader since former director general Roberto Azevêdo stepped down from the position a year early in August. The leadership vacuum came at the same time that the global trade referee faced an upended global supply chain from the pandemic and ongoing tariff disputes between some of the largest economies.&nbsp;</p>



<h3 class="wp-block-heading" id="h-crucial-quote">CRUCIAL QUOTE</h3>



<p>&#8220;A strong WTO is vital if we are to recover fully and rapidly from the devastation wrought by the COVID-19 pandemic,” Okonjo-Iweala said in a statement.&nbsp;</p>



<h3 class="wp-block-heading" id="h-tangent">TANGENT</h3>



<p>The Trump administration refused to back Okonjo-Iweala for the position last fall, saying she lacked trade experience. While 163 other nations coalesced behind Okonjo-Iweala, the U.S. announced in October it would officially back South Korean Trade Minister Yoo Myung-hee in the everyone-must-agree race. But President Joe Biden signaled last week he would reverse efforts to block the appointment, all but ensuring unanimous support of Okonjo-Iweala at the WTO.</p>



<h3 class="wp-block-heading" id="h-what-to-watch-for">WHAT TO WATCH FOR</h3>



<p>When Okonjo-Iweala takes office on March 1, she is set to face significant challenges following gaps in leadership and stalled trade disputes. Former President Donald Trump was highly critical of the WTO and blocked judge appointments on its key decision-making body, upending the organization at the same time that it ramped up global trade disputes.</p>



<h3 class="wp-block-heading" id="h-further-reading">FURTHER READING</h3>



<p><a href="https://www.forbes.com/sites/maggiemcgrath/2020/12/08/power-rising-these-are-the-women-to-watch-in-2021/?sh=f3eb21e767f2">Power Rising: These Are The Women To Watch In 2021</a></p>



<p><a href="https://www.forbesafrica.com/cover-story/2020/12/04/african-of-the-year-ngozi-okonjo-iweala/">African Of The Year: Ngozi Okonjo-Iweala</a></p>



<p><em>By Gina Heeb, Forbes Staff</em></p>



<p><a href="https://www.forbes.com/sites/ginaheeb/"></a></p>


US-WTO-SECRETARY GENERAL-NGOZI

Ngozi Okonjo-Iweala Becomes First Woman, African To Lead World Trade Organization

<p>South Africa’s renewal of the African Growth and Opportunity Act (AGOA) with the United States (US) a few months ago seemed to be about local poultry, when in fact negotiations were about a wider range of exports from 39 predominantly sub-Saharan African countries.</p>
<p>All had to meet the criteria of good governance, sound democratic values and protection of property rights. Countries such as Zimbabwe and Swaziland did not make the cut. It also did not go unnoticed that sub-Saharan Africa accounts for around $1.6 trillion of Africa’s $2.4 trillion GDP. AGOA therefore gives the US economic reach into countries where it would ordinarily have no influence.</p>
<p>AGOA is not a gift. As South Africa discovered, its economic strength on the continent does not guarantee its AGOA membership, and the accompanying eligibility to trade at preferential rates with the US. If South Africa did not loosen its stance on the anti-dumping tariffs imposed on chicken imports from the US, it would feel the costs in more lucrative areas, such as motor vehicles and parts, and wine and citrus exports. In the end, South Africa agreed to take 65,000 tons of bone-in chicken imports per annum, free of anti-dumping duties, from the US. Concessions could, however, have been as high as 300,000 tons, threatening an industry in which almost a billion chickens are slaughtered each year for local consumption.</p>
<p>The arrival of 16,000 tons of US chicken, a few weeks ahead of the deadline in mid-March this year, allowed South Africa to retain its preferential access to the world’s biggest market, and benefit from the latest version of AGOA, which was extended until 2025.</p>
<p>The arm wrestle between the US and South Africa may have been prompted by pressures the Americans were facing elsewhere. The dollar was strong at the time and the US needed to find export markets for its chicken. There was also the issue of a trade war looming with its neighbors, Mexico and Canada, over meat-labeling legislation, where the World Trade Organization ruled in favor of these countries being allowed to retaliate with $1 billion in punitive tariffs.</p>
<p>Another plausible reason was Russia imposing its own sanctions on the US in retaliation for economic sanctions it suffered while attempting to Balkanize the Ukraine. With threats to its industry coming in fast and furiously, pressuring South Africa to make the concessions must have seemed an easy option.</p>
<p>With the focus on what concessions the South African poultry industry had to make, it was easy to lose sight of the shortcomings in South Africa’s domestic trade policy. The concessions shed light on the lackluster performance of the manufacturing sector, caused by the political economy tilting left, protectionist trade policy, restrictive regulation, and labor disruption.</p>
<p>The pending Private Security Bill on the local security industry, which could see 51% of US-based companies, like Chubb, G4S and ADT, sold to South African participants, was also a worry, as were plans to limit foreign ownership of property. While the knee-jerk response may have been to assume that greater local ownership translated to black economic empowerment, a more significant interpretation is that no private foreign entity has an equity interest in South Africa’s state defense and protection services, and by extension, neither should they have controlling equity interest in private security establishments.</p>
<p>Land restitution may also fall short of AGOA legislation. The still-to-be promulgated Regulation of Land Holdings Bill will not affect foreign ownership of residential property, but will prohibit ownership of agricultural land, which could instead be leased for between 30 and 50 years. A ceiling on land ownership would be set at 12,000 hectares, regardless of nationality.</p>
<p>The potential overhaul of intellectual property laws, which could impact the pharmaceutical industry, is also concerning. While it makes socio-economic sense to roll out cheap generic drugs to as many South Africans as possible, foreign-owned multi-nationals may see this as an infringement of patents on their own more expensive medication.</p>
<p>Although the controversy surrounding the chicken industry seems to have settled, South Africa is still vulnerable to the vagaries in US trade policy. Should the US feel aggrieved by any of its preferential offerings, they may be withdrawn much quicker than what was allowed under the older version of the agreement. South African policymakers should be more cautious when making decisions, especially those that affect US interests.</p>


Tag: World Trade Organization

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Ngozi Okonjo-Iweala Becomes First Woman, African To Lead World Trade Organization

Playing Chicken With The US