US eyes alternatives after WTO talks fail on ecommerce duty moratorium

Countries at the World Trade Organization failed to agree on reforms or extend a long-standing e-commerce duty moratorium, prompting the United States to seek alternative agreements and signal a reduced role for the multilateral body in global trade policy.

 

Four days of talks in Yaounde, Cameroon, ended early Monday without consensus after Brazil and Turkey blocked a proposal to extend the moratorium on duties for digital trade, including downloads and streaming. The lapse marks the first time in 28 years that the measure has expired.

 

US Trade Representative Jamieson Greer said Washington would work with like-minded partners outside the WTO if the moratorium is not restored. He added that agreements had already been secured with dozens of countries not to impose tariffs on US digital transmissions.

 

 

Greer, a key architect of President Donald Trump’s tariff-driven trade agenda, criticised the outcome of the meeting, calling it an impasse and questioning the organisation’s effectiveness.

 

“I have always been sceptical of the value of the WTO, and this week’s conference confirmed that this organisation will play only a limited role in future global trade policy efforts,” Greer said.

 

WTO relevance under scrutiny

 

The breakdown underscores growing challenges for the WTO, which has increasingly been sidelined amid rising economic nationalism. Analysts said the failure to extend the moratorium further weakens confidence in the institution.

 

Andrew Wilson said the outcome marked “another crack in the foundations” of the WTO system, while industry representatives warned that digital trade issues had become overly politicised.

 

Despite the setback, a group of 66 WTO members agreed to move forward with a baseline framework for digital trade rules, reflecting a shift toward smaller, plurilateral agreements.

 

Risk of fragmented trade deals

 

Experts cautioned that such arrangements could create a complex “spaghetti bowl” of overlapping agreements. Dmitry Grozoubinski said the trend risks complicating global trade governance.

 

Efforts to bridge differences on the moratorium included proposals ranging from a two-year to a permanent extension, but negotiations ultimately failed. Developing countries argued that extending the moratorium would deprive them of potential tax revenues from digital trade.

 

Ngozi Okonjo-Iweala said talks would continue in Geneva, expressing hope that the moratorium could still be reinstated.

 

The impasse highlights widening divides between developed and developing nations over digital trade, as well as broader tensions over the future role of multilateral institutions in shaping global commerce.