Australian treasurer: WTO has failed

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The World Trade Organization is not fit for purpose, the Australian treasurer has argued.

The World Trade Organization (WTO) has failed to keep up with current global economic conditions and should be reviewed if it is to be effective in future.

This is according to Australian treasurer Scott Morrison, who told Fairfax in an interview after the most recent G20 meeting that now would be a good opportunity to look again at the rules and review the global trading system.

He argued that the WTO was "built for a different time", although he did not spell out precisely what changes he thinks are necessary going forward.

Many analysts have also been critical of the WTO in recent times, pointing out that it has failed to resolve disputes within a reasonable time and has increasingly been left on the sidelines as nations pursue bilateral and preferential trade agreements among themselves.

The news may please US president Donald Trump, who has also been a vocal critic of the WTO trade rules lately.

Meanwhile, the European Commission has circulated reports suggesting that some promising advances have been made concerning early negotiating rounds with Australia and New Zealand for free trade agreements (FTAs).

This puts the European Union ahead of the UK in the queue to secure FTAs, despite Britain having identified these markets as prime targets for new trade links. The UK cannot begin negotiations until Brexit takes place in March 2019.