Membership of the World Trade Organization (WTO) has benefitted the US and China more than any other nations, a study published found, as the two powers seek to defuse a months-long trade conflict.
The Bertelsmann Foundation research showed WTO membership has boosted the US’s gross domestic product by USD 87 billion in the 25 years since the country joined.
China, which became a member-only in 2001, gained USD 86 billion, while Germany added USD 66 billion.
“Even if no organisation is perfect, anyone who believes they can rely on a system of bilateral trade agreements instead of the WTO risks enormous losses of prosperity in international trade,” said Bertelsmann trade expert Christian Bluth.
With 164 member countries, the WTO will celebrate a rocky 25th anniversary on January 1, 2020. Washington refuses to name new judges to its appellate body, blocking arbitration of trade disputes.
Washington and Beijing have nonetheless struck a truce in their tit-for-tat tariff war, hoping to sign a preliminary trade deal in January. Around the world, Bertelsmann found WTO members gained on average 4.5 per cent of GDP from membership.
The total increase reached USD 855 billion or one percent of global output, the study showed.
And around the world, WTO members’ exports increased an average of 14 per cent between 1980 and 2016, while non-members’ exports fell almost six per cent.
So far, “nations with strong exports and production are the main beneficiaries” of WTO membership, the Bertelsmann Foundation said in a statement, pointing to countries such as South Korea and Mexico as further winners.
European countries with smaller manufacturing sectors have not been able to make such large gains from WTO membership.