DDG Nordquist: WTO remains the foundation of global trade despite growing challenges

Good morning, everyone.

Let me begin by thanking Dubai Multi Commodities Centre (DMCC) and Asia House for the invitation to join you today and for producing another edition of the Future of Trade report. 

At a time when businesses, governments, and international organizations are all grappling with profound change, initiatives like this one make an important contribution by helping us look beyond the immediate headlines and think more strategically about where global trade is heading.

And there is certainly no shortage of issues to discuss.

• Artificial intelligence is transforming production, services, and trade operations.
• Supply chains are adapting to geopolitical tensions, which includes dealing with good ol' fashioned geography, not just technology.
• New technologies are changing how goods move, how services are delivered, and how firms compete. 

Taken together, these developments raise important questions about the future of world trade and the institutions that underpin it.

The headlines often focus on fragmentation, de-risking, and frictions. Yet the data tell a more nuanced story. Global trade in goods and services expanded by approximately 4.7% in 2025, significantly above the rate of global economic growth (2.9%) - almost double -- and a significantly better performance than even our own economists had predicted (-0.2%).  While our economists expect merchandise trade growth to slow to 1.9% in 2026, trade is projected to expand again to 2.6% in 2027.  As you can tell, it's pretty hard to model something predicated on geonomic variables.

Among institutions governing international trade, the WTO is sometimes portrayed (including in your report) as struggling to keep pace. This narrative is understandable, but it is also incomplete.

In fact, to quote the great American humorist Mark Twain, reports of the WTO's demise have been greatly exaggerated. 

If one looks only at the difficulty of negotiating new agreements, it is easy to conclude that the system is under strain. Yet if one looks at how governments and businesses actually behave, a different picture emerges. The WTO today has 166 Members accounting for the overwhelming majority of global trade. Not a single Member has ever chosen to leave the Organization, while more than 20 governments are currently negotiating accession - they want in. Whatever criticisms governments may have of specific aspects of the system, they continue to see value in membership.

The trade data tell a similar story. Despite the rapid growth of bilateral and regional trade agreements over the past three decades, approximately 72 percent of global merchandise trade still takes place on most-favoured-nation terms under WTO rules. Regional agreements undoubtedly play an important role but they are built upon a multilateral framework that continues to provide the foundation for global commerce. The WTO remains the baseline.

Within the WTO itself, groups of Members have been advancing new initiatives through plurilateral approaches, including recent agreements on services domestic regulation, investment facilitation for development, and e-commerce. Many Members see them as a pragmatic way of advancing rule-making in areas where broad consensus among the full Membership may be difficult to achieve. Together, these developments demonstrate that the trading system is adapting to new realities rather than paralysis.

The WTO matters because businesses thrive on predictability - I don't need to tell the folks in this room that. They need confidence that market access conditions will not change unexpectedly, that regulations will be transparent, and that governments will operate within a framework of agreed rules. Every day, companies make investment, sourcing, and production decisions based on WTO commitments relating to tariffs, customs procedures, technical regulations, services, intellectual property, and transparency obligations.

Much of this work happens quietly. In fact, one of the WTO's greatest strengths is that some of its most valuable contributions receive the least public attention. When people think about the Organization, they often focus on Ministerial Conferences, disputes, and major negotiations. Yet much of the WTO's practical value lies in its day-to-day work, particularly in the committees where delegates meet throughout the year to exchange information, raise concerns, and address emerging trade issues.

These committees are the unsung heroes of the multilateral trading system.

Every year, Members bring hundreds of trade concerns to the WTO covering issues such as standards, licensing requirements, customs procedures, subsidies, and technical regulations. According to WTO data, approximately half of the trade concerns raised by Members are eventually reported as resolved.

Every concern resolved through discussion is a potential disruption avoided. Every exchange of information helps traders better understand the conditions under which they operate. In a world where supply chains are increasingly complex and interconnected, that kind of predictability has real economic value.

The WTO's role becomes even more apparent during economic shocks. The COVID-19 pandemic demonstrated how essential trade and cross-border supply chains can respond to global emergencies. The WTO helped by providing timely information to policymakers, identifying bottlenecks, and encouraging measures to speed the movement of vaccine inputs and other critical products.

Today, we see similar needs in other contexts. As developments in and around the Strait of Hormuz continue to evolve, the WTO is monitoring trade flows through a dedicated dashboard that combines vessel-tracking data with cross-commodity cargo intelligence. Updated daily, it provides near-real-time insights into the volume and pattern of trade in products transiting or affected by developments in the region. And what we see is that governments' response to the Strait of Hormuz disruption has been notably less restrictive than compared to the last 2 shocks of Covid and war in Ukraine. Of the roughly 78 trade measures introduced so far, about 70% have facilitated trade, including steps to boost supplies of oil, gas, and refined products, ease export restrictions, and streamline customs procedures for energy, fertilisers, and food.

Of course, the WTO cannot afford to stand still.

The institution needs reform, and one of the few issues on which there is broad agreement among Members is precisely that point. The global economy has changed dramatically since 1995, but rules have not been updated to match the economic reality. That's not unique to trade: at least in the US, the government cannot match the pace of innovation.  My guess is that it's the same in many other countries.

So the challenge is not whether reform is needed, but how to achieve it.

The WTO operates by consensus - which has been defined as "unanimity" -- and brings together 166 Members with different levels of economic development, legal and commerce systems, and national priorities. Building agreement under those circumstances is inherently difficult, particularly on complex and politically sensitive issues. 

At the most recent Ministerial Conference, Members were unable to formally adopt the Yaoundé Package, including the extension of the e-commerce moratorium-an outcome of considerable importance to businesses worldwide-and elements of the WTO reform agenda. However, negotiations did not stop there, and Members have continued to engage actively in Geneva to bridge differences on these issues.

This is not without precedent. Throughout the WTO's history, there have been instances where ministers were unable to finalize outcomes at a Ministerial Conference, and the work was subsequently taken forward in Geneva through the General Council. The e-commerce moratorium has lapsed twice before, so this is not unprecedented. On those previous occasions, governments did not rush to introduce duties, and they have not done so this time either, thus far at least.

What matters is that Members continue to engage, negotiate, and look for solutions. And that is happening with the provisional application of the 66-Member E-Commerce Agreement and the 23-Member commitment to not impose duties on each other.

As we look ahead, the future of trade will undoubtedly be shaped by forces that were barely imaginable when GATT or then the WTO were created. New technologies will transform production. Digital trade will continue to expand. Supply chains will evolve in response to both economic and geopolitical realities.

The questions will change, but the need for cooperation will not.

Businesses will continue to require predictability.

Governments will continue to need transparency.

Markets will continue to function best when participants have confidence in the rules that govern them. 

Those principles remain at the heart of the WTO, and they are likely to become even more valuable in the years ahead.

Yes, the institution faces challenges.

Yes, it requires reform.

Yes, it must continue adapting to a changing world. 

Yet it remains the foundation for most international trade, a source of transparency during periods of uncertainty, a forum where governments can address concerns before they become disputes, and an institution in which governments continue to invest because they recognize its value.

In a world that is becoming more complex, those functions are becoming more important, not less.

Thank you very much, and congratulations again to DMCC and Asia House on the launch of the 2026 Future of Trade report.