US threatens to block WTO budget

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US delegates have suggested they might act against a vital process for the WTO.

It is feared that the US may block the forthcoming approval of the World Trade Organization's biennial budget, something that could halt the governing body's work altogether.

At a meeting in Geneva this week, a US delegate said the country is concerned about payments to the appellate body and about funding being diverted to a proxy dispute settlement system, Bloomberg reports.

Since any decisions made by the WTO must have consensus among all 164 members, any action by the US to block the budget being approved may threaten the WTO's functioning.

Members only have until December 31st 2019 to adopt a budget for the next two years, with another meeting now set for next week to discuss the issue in earnest.

According to a WTO document, the US also plans to deliver a statement on November 22nd 2019 relating to its concerns over compensation of appellate body members.

Member states are now worried about the future of the WTO's work and whether nations will be able to rely on it in future when it comes to negotiating trade deals and settling disputes.

This is not the first time US president Donald Trump has demonstrated his disapproval of the WTO's methods, having in the past threatened to withdraw from it entirely.

His administration claims it has flouted the rules to allow China to grow into a superpower and that its dispute settlement system has strayed from the original mandate to look unfavourably on America.

As a result, Mr Trump has blocked all new appointments in the WTO appellate body for the past two years, meaning it is now operating with just two members - the legal bare minimum - whose terms are set to expire on December 10th 2019.

Canada, the EU and Norway have been looking into the creation of an alternate channel for arbitration to use as a stopgap in case of deadlock on the matter.

The US currently contributes more funding towards the WTO's annual budget than any other single country, but it remains to be seen whether or not this will continue to be the case by the end of this year.