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World Trade Organization headquarters in Geneva, Switzerland
Image: picture-alliance/dpa/Keystone/S. Di Nolfi

South Korea struggles to get WTO candidate elected

Julian Ryall
November 6, 2020

The US has officially backed South Korean Trade Minister Yoo Myung-hee for the WTO's top job, but a majority of members, including the European Union, have supported a rival bid from Nigeria's Ngozi Okonjo-Iweala.

https://p.dw.com/p/3kxCM

South Korea is still campaigning for its candidate, Yoo Myung-hee, to be named the next director-general of the World Trade Organization (WTO) on November 9.  

Member nations are due to select the successor to Roberto Azevedo — who stepped down from the WTO's top job at the end of August, a year before his term ended — and the choice has been narrowed down from eight to just two names.

On the short list alongside Yoo, currently serving as the South Korean trade minister, is Ngozi Okonjo-Iweala, a former Nigerian finance minister. Whatever the decision, the all-female short list means that the WTO will for the first time be headed by a woman. 

South Korean President Moon Jae-in has in recent weeks been campaigning hard for Yoo.

The EU, however, decided in late October to throw its united weight behind Okonjo-Iweala.

Ngozi Okonjo-Iweala and Yoo Myung-hee
Okonjo-Iweala (left) is a former Nigerian finance minister and Yoo (right) currently serves as South Korea's trade minister

With US support, all is not lost

Japan has not publicly stated a preference for either of the candidates, but it is strongly rumored that Tokyo is also backing the Nigerian candidate out of concern that a South Korean head of the WTO could side with Seoul in the ongoing trade disputes between South Korea and Japan. 

"Ban Ki-moon was the secretary-general of the United Nations from 2007 to 2016, and ever since then there has been a high degree of enthusiasm for Koreans to play important roles in international organizations," Park Saing-in, an economist with the Graduate School of Public Administration at Seoul National University, told DW.  

"Trade and business are obviously important to the nation, and that is another reason why the president is so keen for Yoo to take this position," he added.  

Read more: World Trade Organization in trouble: What you need to know

Park admits that it appears that two-thirds of the international community favor the Nigerian candidate. All is not lost, however, as the United States is backing Yoo's candidacy. That is because the current administration in Washington believes that Okonjo-Iweala is too close to China, with which the US is locked in a trade dispute. 

US President Donald Trump has described the WTO as "horrible" and biased toward China. His administration has also paralyzed the body's role as global arbiter on trade by blocking appointments to its appeals panel.

"Things might settle down if there is a new administration in the US, but everything is just very confused at the moment," said Park.

No support from Japan

Japan, on the other hand, is very unlikely to change its position. "South Korea and Japan are locked into a trade conflict after Tokyo unilaterally imposed restrictions on exports of key chemicals to Korea last year, and Seoul has appealed that decision to the WTO for a ruling," he said. 

Tokyo insists it introduced the new restrictions on chemicals that are critical to South Korea's high-tech manufacturing industry out of concern that banned technology that originated in Japan is finding its way to North Korea, calling the South's export controls too lax.

Seoul claims the move is retaliation for South Korea going back on agreements on matters of history signed by the two governments. 

Read more: WTO faces uncertainty amid Trump threats, successor search

The most contentious issue is related to compensation for Koreans forced to work for Japanese firms during the colonial period in the early decades of the last century. Japan says all matters of compensation have been settled under the 1965 treaty that normalized relations between the two nations and was accompanied by a payment of $500 million (€421 million) in compensation.

The South Korean Supreme Court has recently disagreed with that position and ruled that former forced laborers can sue the companies that they worked for. The court has seized the local assets of Mitsubishi Heavy Industries and is in the process of liquidating them on behalf of the plaintiffs. 

Last year, Yoo oversaw Korea's WTO complaint about Japan's export restrictions.

Yet Park insists that a South Korean head of the WTO would be "completely impartial" in any issues handed to the organization to adjudicate — and that her nationality might work against her in such a situation. 

WTO 'unable to resolve its problems'

'Suspicion, nationalism behind Tokyo's position'

Yakov Zinberg, professor of East Asian studies at Tokyo's Kokushikan University, says there may be some envy and nationalism behind Japan's reluctance to endorse the Korean candidate. 

"I sense suspicion and nationalism behind Tokyo's position, as well as envy, as the South Korean economy appears to be performing relatively well in the current difficult economic situation, and certainly better than that of Japan," he told DW.

"Japan usually follows America's lead in a situation like this, but they cannot bring themselves to do it this time round because they are so opposed to South Korea on so many issues," he said. 

The decision to name the next WTO head needs to be approved by consensus, meaning any of the 164 members could block the appointment.

The lack of a consensus threatens to render the WTO leaderless at a time when the global economy is facing headwinds from the coronavirus pandemic, increased protectionist tendencies worldwide and the US-China trade conflict, among other things.

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