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Read original →Professor Kharlamov: WTO Cannot Stop Trade Crisis Single-Handedly
The WTO Director-General has called for diversifying supply chains amid growing fragmentation of global trade. Financial University Professor Alexey Kharlamov explains why the organization's capabilities are limited: protectionism, politicization of decisions, and the crisis in dispute resolution mechanisms are undermining the WTO's influence.
Global trade needs to strengthen supply chains and reduce production dependence on individual geographic locations, stated WTO Director-General Ngozi Okonjo-Iweala. Against the backdrop of growing fragmentation, she called for distributing production among territories with competitive advantages. However, the WTO's own capacity to facilitate such changes is limited, believes Alexey Kharlanov, Doctor of Economics and Professor in the Department of International Business at the Financial University under the Government of the Russian Federation:
"The WTO's influence has indeed weakened, but it's premature to reduce it to a 'symbolic institution,'" Kharlanov believes.
In his assessment, the organization's position is undermined by rising protectionism, the politicization of trade decisions, and the crisis in the appellate stage of dispute resolution. At the same time, the consensus principle makes it difficult to agree on new rules: when members' interests diverge, even broad support for an initiative doesn't guarantee its adoption. As a result, states are more actively seeking agreements in regional and bilateral formats. The organization maintains a common normative foundation for trade, but ensuring compliance with obligations and updating them is becoming more difficult.
Nevertheless, the significance of this foundation remains substantial: according to the World Trade Report 2026, approximately 72% of global goods trade is conducted under most-favored-nation tariff conditions—that is, with the same import duties applied to identical goods from different WTO member countries. Kharlanov notes that the WTO still provides a platform for negotiations, monitors trade restrictions, and allows members to challenge specific measures by partners. For supply chains, these tools are no less important than expanding the pool of producers: new connections require clear conditions for market access. But the organization's capabilities are limited by the will of its members.