President Donald Trump was set to sign an executive order issuing directions to review all international trade agreements inked by the US, including the WTO, in a bid to address trade “violations and abuses“. The order will not just outline the problem, but will also provide alternative solutions to them.

“As far as I can tell there has never been a systematic evaluation of what has been the impact of the World Trade Organisation (WTO) agreements on the country as an integrated whole. So it’s trying to find violations and abuses,” US Commerce Secretary Wilbur Ross told reporters at a White House news conference.

“It calls for a report within 180 days. It calls for not just outlining the problem or problems, but also proposing the alternative solutions to them,” Ross said yesterday.

Trump was scheduled to sign the order on Establishment of Office of Trade and Manufacturing Policy this evening.

Ross said the executive order will address specifically violations and abuses under existing trade agreements and that is what differentiates it from some of the earlier ones. “This is focusing more narrowly on the agreements themselves,” he said.

“Now, not all of the free-trade agreements that we have result in deficits. But some of the larger ones also result in some of the larger deficits. In all trade relations with companies, other than free-trade companies, are governed by WTO. So that’s really the grandparent of all trade arrangements that we have,” he said.

Ross said Trump has been talking about reciprocal concept.

“If we have a country that has big trade barriers against us, we should logically have similar trade barriers against them. If there’s a country that has relatively few barriers against us, we should have relatively few against them,” he said.

Ross said the only problem was the WTO’s “most favoured nation clause” which meant that of all the countries with whom America did not have a free-trade agreement, it must charge the same tariff on the same item to those countries as it charges to others. “So that’s a significant impediment toward getting to anything like a reciprocal agreement,” he said.

WTO does not deal very much with non-tariff trade barriers and it does not deal very effectively with intellectual property rights, and does not deal very much effectively with the whole digital economy, Ross said.

“So there are some real gaps within it,” he said, adding that there is also structural problem of the dispute resolution mechanism at the WTO. (It) takes a very long time, and given the composition of the WTO panels, often we’re defeated when people come and appeal it. Because if the people on the panel are mostly people who are doing the same thing as what you’re complaining about, it’s a little bit hard to get them to vote for you,” remarked Ross.

Ross rued that WTO was a very, very bureaucratic organisation. “Their main meetings occur four times a year. Well, when you think about how dynamic trade is and how rapidly it changes, the idea of a leisurely four-times-a-year meeting schedule, it’s really not very consistent with dealing with problems,” he said.

“If you look at the last annual report that the WTO published, it’s filled with complaints that there are more trade actions, more actions alleging violations than there used to be. They lament that as protectionist. It apparently doesn’t occur to them that perhaps the cause of it is more violations by more countries. But that’s the reality,” he said.

“That’s why the trade actions are being brought, there’s more and more dumping all over the place, but there’s an institutional bias on their part toward the exporters rather than toward people who are being beleaguered by inappropriate imports,” Ross said.