Fifteen Eighty Four

Robert Hudec, in his book Developing Countries in the GATT Legal System, notes that the GATT began with “essentially a parity of obligation” among all parties (developed and developing) but vis-á vis developing countries was soon torn between a Dr. Jekyll, good guy role – to “help” by exempting developing countries from policy discipline −  and a Mr. Hyde, bad guy role − holding them to the same policy discipline as developed countries.

In Robert Louis Stevenson’s story, Mr. Hyde finds it increasingly difficult to shift back to Dr. Jekyll (Hyde enjoys being bad). In Robert Hudec’s story the GATT morphs into a kindly Dr. Jekyll, into an excuser, accepter, even promoter of license for developing countries to do whatever they want. Everyone enjoys. In the mercantilist logic of the GATT, this license is an asset twice-blessed; developed countries earn moral credit for giving, developing countries the blessing of receiving.

The WTO’s Trade Facilitation Agreement (approval of which India has blocked for reasons not taken up here) tries to be both Dr. Jekyll and Mr. Hyde. It offers a schedule of policy disciplines on things such as fees and formalities of exporting and importing, and at the same time suggests that developing countries will receive assistance (i.e., be paid) to abide by them.

However, a close look at the legal mechanics of the agreement reveals it to be it another instance of the smoke and mirrors negotiators have applied historically to create the appearance of legal obligation in GATT/WTO’s relations with developing countries − but at the same time to avoid the substance (the story Hudec tells).

Doing as the agreement specifies is not made legally binding by taking the money, i.e., if a developing country takes the money but does not honor the agreement, WTO legalities offer no way to force it to give back the money.  In parallel, if a developing country accepts the legal obligations, WTO legalities offer no way to guarantee that the promised money will be delivered.

Morals: Robert Louis Stevenson was right. Dr. Jekyll and Mr. Hyde cannot live in the same body. Robert Hudec was right: the GATT/WTO system is not an exception to Stevenson’s moral.