The dynamism of today’s Global Order, more so with Covid-19 around, makes the idea of self-regulation of WTO member countries seem somewhat bizarre and threatening to the role of the Dispute Settlement Body (DSB) in itself. In the backdrop of growing Legal Pluralism, this write-up attempts to engage with the relevance of the ‘necessary’ test pertaining to Article XX of General Agreement on Tariffs and Trade (1994).
Article XX of GATT lays down the General Exceptions under which International trade may be restricted justifiably under the chapeau. Subparagraphs a) to j) list down reasons such as protection of human, animal or plant health, protection of public morals, etc. to justify a restriction on international trade. The appropriateness of the disputed measures is tested through the ‘necessary test’ under subparagraphs a), b), and d).
While a so-called detailed analysis of ‘necessary’ came up only in the Korea-Beefdispute, the word in itself was interpreted much before in Thailand – Restrictions on Importation of and Internal Taxes on Cigarettes. In this dispute, it was held that in the presence of reasonable alternatives measures, a complete import prohibition by Thailand was not sustainable under GATT provisions. On a similar note, the Panel in the United States – Restrictions on Imports of Tuna held that the US did not meet the level of necessity as required within the scope of Article XX as it had not exhausted all the reasonably available options. Both these Panel reports failed to conclusively determine what the ‘necessary’ test entails.
It was only in the Korea-Beef that the Appellate Body conclusively laid down that necessary test involves the ‘cost-benefit balancing’ test. For a measure to be necessary-Firstly, the more common and vital the values or the common interests that the measure seeks to protect, the easier it will be to accept such a measure. Secondly, the measure which is likely to have a slight impact on imports will be deemed necessary more easily as compared to a measure capable of gravely impacting the imports. Thirdly, that there is no reasonable alternative option available be it in a less trade-restrictive way or with lesser trade costs than the measure in question.
Donald H. Regan, in his piece titled ‘The meaning of ‘necessary’ in GATT Article XX and GATS Article XIV: the myth of cost-benefit balancing’, engaged in an extensive analysis of the cost-benefit balancing test. He quite aptly debunked the confusion caused by the ‘necessary’ test as interpreted in Korea-Beef. The Appellate Body held that the test is to find out if there exists some alternative measure which entails less trade cost as compared to the measure in question. Regan pointed out an extremely significant blunder in the formulation of this test by the Appellate Body. He noted that while the alternate measure should be preferred because of its lesser trade costs, the Appellate Body failed to take note of many circumstances wherein such alternate measures might have significantly higher administrative or enforcement costs as compared to trade cost. This would completely defeat the purpose of a cost-benefit balancing test as the comparison was between trade costs and administrative/ enforcement costs instead of it being against trade costs and the underlying goal that the measure seeks to achieve. In pretending to do so, the Appellate Body in Korea-Beef dispute ultimately ended up not using the cost-benefit balancing test at all and instead took up the less-restrictive alternative approach test, which merely enforces the classic principle of members getting to choose their ‘own level of protection’. Subsequent disputes such as EC–Asbestos (involving GATT XX(b)), US–Gambling (which corresponds to GATT XX(a)), and the Dominican Republic–Cigarettes (involving GATT XX(d)) took the same route as Korea-Beefin using the own level of protection test in the garb of the cost-benefit balancing test.
This selective engagement with the necessary test by the Paneland the Appellate Bodyis a testament to the changing International Legal Order. Both the tests, be it the cost-benefit balancing test or the own level of protection test, the concern deep down in World Trade Law is the level of scrutiny to which members are subjected to, upon acting unilaterally. This essentially makes it an issue of International Legal Pluralism (Joel P. Trachtman), which seeks to establish multiple loci of authority in the International Law sphere.Considering the cost-benefit balancing test, which follows a strict-pronged approach to ascertain if a measure is necessary under Article XX of GATT, it could be said that this stands in stark contrast to the own level of protection test which constitutes a lenient way to let the members decide for their own. These two tests then may be forming the foundations of the deeply rooted Pluralism in International law. While the cost-benefit balancing test has Theoretical Pluralism’s underpinnings, the own level of protection test has Methodological Pluralism’s foundations both in scope and authority.
Theoretical Pluralism, as opined by Peter Joachim Katzenstein and Rudra Sil,is based strictly on legal scholarship located within a particular paradigm and is thereby often critiqued to be very pessimistic about the possibilities of diplomacy and international co-operation. Hence, the cost-benefit balancing test falls flat based on this logic.
Methodological Pluralism, on the other hand, as recently opined by Patrick Thaddeus Jackson, is a legal order in International law based on an open-ended paradigm approach that draws theoretical traditions from complex practical problems of the law. The own level of protection test seems to be in line with methodological Pluralism because of how it imbibes rationalist approaches (of Martti Koskenniemi)to International Law. This belief in the unilateral acts of the states to be in coherence with global diplomacy allows for the own level of protection test to be capable of finding the maximal accommodation to alternative measures for claiming the exception under Article XX of GATT.
Thus, the Dispute Settlement Body’s interpretation of ‘necessary’ seems apt in this dynamic global environment, for it allows WTO members to choose their own level of protection in availing the exceptions under Article XX of GATT. This is reflective of the evolving legal order in consonance with methodological Pluralism. The significance of such Pluralism will increase multifold in the post-Covid-19 world, where the Global Legal Order will play out on a wholly revised note.
 Korea – Measures Affecting Imports of Fresh, Chilled and Frozen Beef, WT/DS161 and 169/AB/R
(adopted 10 January 2001).
 DS10/R, adopted on 7 November 1990, 37S/200.
DS29/R, dated 16 June 1994, paras. 5.28-5.39.
Donald H. Regan, The meaning of ‘necessary’ in GATT Article XX and GATS Article XIV: the myth of cost-benefit balancing, World Trade Review (2007), pp 347-369, <https://pdfs.semanticscholar.org/ebef/36536ebef67f4acd0514e7ab9cceab6d3a09.pdf>
 Joel P. Trachtman, The Crisis of International Law, 44 Case W. Res. J. Int’l L. 407 (2011) Available at: <https://scholarlycommons.law.case.edu/jil/vol44/iss1/6>
Peter Joachim Katzenstein FBA is the Walter S. Carpenter, Jr. Professor of International Studies at Cornell University.
Rudra Sil is Professor of Political Science and the SAS Director of the Huntsman Program in International Studies & Business. He holds a Ph.D. from the University of California at Berkeley and has been teaching at Penn since 1996.
Patrick Thaddeus Jackson is Professor of International Studies in the School of International Service, and also Director of the AU Honors program. He previously taught at Columbia University and New York University.
David Roth-Isigkeit, ‘The blinkered discipline?:MarttiKoskenniemi and interdisciplinary approaches to international law’, Cambridge University Press 2017
The Covid After-Effects and the Looming Skills Shortage
The shock of the pandemic is changing the ways in which we think about the world and in which we analyze the future trajectories of development. The persistence of the Covid pandemic will likely accentuate this transformation and the prominence of the “green agenda” this year is just one of the facets of these changes. Market research as well as the numerous think-tanks will be accordingly re-calibrating the time horizons and the main themes of analysis. Greater attention to longer risks and fragilities is likely to take on greater prominence, with particular scrutiny being accorded to high-impact risk factors that have a non-negligible probability of materializing in the medium- to long-term. Apart from the risks of global warming other key risk factors involve the rising labour shortages, most notably in areas pertaining to human capital development.
The impact of the Covid pandemic on the labour market will have long-term implications, with “hysteresis effects” observed in both highly skilled and low-income tiers of the labour market. One of the most significant factors affecting the global labour market was the reduction in migration flows, which resulted in the exacerbation of labour shortages across the major migrant recipient countries, such as Russia. There was also a notable blow delivered by the pandemic to the spheres of human capital development such as education and healthcare, which in turn exacerbated the imbalances and shortages in these areas. In particular, according to the estimates of the World Health Organization (WHO) shortages can mount up to 9.9 million physicians, nurses and midwives globally by 2030.
In Europe, although the number of physicians and nurses has increased in general in the region by approximately 10% over the past 10 years, this increase appears to be insufficient to cover the needs of ageing populations. At the same time the WHO points to sizeable inequalities in the availability of physicians and nurses between countries, whereby there are 5 times more doctors in some countries than in others. The situation with regard to nurses is even more acute, as data show that some countries have 9 times fewer nurses than others.
In the US substantial labour shortages in the healthcare sector are also expected, with anti-crisis measures falling short of substantially reversing the ailments in the national healthcare system. In particular, data published by the AAMC (Association of American Medical Colleges), suggests that the United States could see an estimated shortage of between 37,800 and 124,000 physicians by 2034, including shortfalls in both primary and specialty care.
The blows sustained by global education from the pandemic were no less formidable. These affected first and foremost the youngest generation of the globe – according to UNESCO, “more than 1.5 billion students and youth across the planet are or have been affected by school and university closures due to the COVID-19 pandemic”. On top of the adverse effects on the younger generation (see Box 1), there is also the widening “teachers gap”, namely a worldwide shortage of well-trained teachers. According to the UNESCO Institute for Statistics (UIS), “69 million teachers must be recruited to achieve universal primary and secondary education by 2030”.
From our partner RIAC
Accelerating COVID-19 Vaccine Uptake to Boost Malawi’s Economic Recovery
Since the onset of the COVID-19 pandemic, many countries including Malawi have struggled to mitigate its impact amid limited fiscal support and fragile health systems. The pandemic has plunged the continent into its first recession in over 25 years, and vulnerable groups such as the poor, informal sector workers, women, and youth, suffer disproportionately from reduced opportunities and unequal access to social safety nets.
Fast-tracking COVID-19 vaccine acquisition—alongside widespread testing, improved treatment, and strong health systems—are critical to protecting lives and stimulating economic recovery. In support of the African Union’s (AU) target to vaccinate 60 percent of the continent’s population by 2022, the World Bank and the AU announced a partnership to assist the Africa Vaccine Acquisition Task Team (AVATT) initiative with resources, allowing countries to purchase and deploy vaccines for up to 400 million Africans. This extraordinary effort complements COVAX and comes at a time of rising cases in the region.
I am convinced that unless every country in the world has fair, broad, and fast access to effective and safe COVID-19 vaccines, we will not stem the spread of the pandemic and set the global economy on track for a steady and inclusive recovery. The World Bank has taken unprecedented steps to ramp up financing for Malawi, and every country in Africa, to empower them with the resources to implement successful vaccination campaigns and compensate for income losses, food price increases, and service delivery disruptions.
In line with Malawi’s COVID-19 National Response and Preparedness Plan which aims to vaccinate 60 percent of the population, the World Bank approved $30 million in additional financing for the acquisition and deployment of safe and effective COVID-19 vaccines. This financing comes as a boost to Malawi’s COVID-19 Emergency Response and Health Systems Preparedness project, bringing World Bank contributions in this sector up to $37 million.
Malawi’s decision to purchase 1.8 million doses of Johnson and Johnson vaccines through the AU/African Vaccine Acquisition Trust (AVAT) with World Bank financing is a welcome development and will enable Malawi to secure additional vaccines to meet its vaccination target.
However, Malawi’s vaccination campaign has encountered challenges driven by concerns regarding safety, efficacy, religious and cultural beliefs. These concerns, combined with abundant misinformation, are fueling widespread vaccine hesitancy despite the pandemic’s impact on the health and welfare of billions of people. The low uptake of COVID-19 vaccines is of great concern, and it remains an uphill battle to reach the target of 60 percent by the end of 2023 from the current 2.2 percent.
Government leadership remains fundamental as the country continues to address vaccine hesitancy by consistently communicating the benefits of the vaccine, releasing COVID data, and engaging communities to help them understand how this impacts them.
As we deploy targeted resources to address COVID-19, we are also working to ensure that these investments support a robust, sustainable and resilient recovery. Our support emphasizes transparency, social protection, poverty alleviation, and policy-based financing to make sure that COVID assistance gets to the people who have been hit the hardest.
For example, the Financial Inclusion and Entrepreneurship Scaling Project (FInES) in Malawi is supporting micro, small, and medium enterprises by providing them with $47 million in affordable credit through commercial banks and microfinance institutions. Eight months into implementation, approximately $8.4 million (MK6.9 billion) has been made available through three commercial banks on better terms and interest rates. Additionally, nearly 200,000 urban households have received cash transfers and urban poor now have more affordable access to water to promote COVID-19 prevention.
Furthermore, domestic mobilization of resources for the COVID-19 response are vital to ensuring the security of supply of health sector commodities needed to administer vaccinations and sustain ongoing measures. Likewise, regional approaches fostering cross-border collaboration are just as imperative as in-country efforts to prevent the spread of the virus. United Nations (UN) partners in Malawi have been instrumental in convening regional stakeholders and supporting vaccine deployment.
Taking broad, fast action to help countries like Malawi during this unprecedented crisis will save lives and prevent more people falling into poverty. We thank Malawi for their decisive action and will continue to support the country and its people to build a resilient and inclusive recovery.
This op-ed first appeared in The Nation, via World Bank
An Airplane Dilemma: Convenience Versus Environment
Mr. President: There are many consequences of COVID-19 that have changed the existing landscape due to the cumulative effects of personal behavior. For example, the decline in the use of automobiles has been to the benefit of the environment. A landmark study published by Nature in May 2020 confirmed a 17 percent drop in daily CO2 emissions but with the expectation that the number will bounce back as human activity returns to normal.
Yet there is hope. We are all creatures of habit and having tried teleconferences, we are less likely to take the trouble to hop on a plane for a personal meeting, wasting time and effort. Such is also the belief of aircraft operators. Add to this the convenience of shopping from home and having the stuff delivered to your door and one can guess what is happening.
In short, the need for passenger planes has diminished while cargo operators face increased demand. Fewer passenger planes also means a reduction in belly cargo capacity worsening the situation. All of which has led to a new business with new jobs — converting passenger aircraft for cargo use. It is not as simple as it might seem, and not just a matter of removing seats, for all unnecessary items must be removed for cargo use. They take up cargo weight and if not removed waste fuel.
After the seats and interior fittings have been removed, the cabin floor has to be strengthened. The side windows are plugged and smoothed out. A cargo door is cut out and the existing emergency doors are deactivated and sealed. Also a new crew entry door has to be cut-out and installed.
A new in-cabin cargo barrier with a sliding access door is put in, allowing best use of cargo and cockpit space and a merged carrier and crew space. A new crew lavatory together with replacement water and waste systems replace the old, which supplied the original passenger area and are no longer needed.
The cockpit gets upgrades which include a simplified air distribution system and revised hydraulics. At the end of it all, we have a cargo jet. If the airlines are converting their planes, then they must believe not all the travelers will be returning after the covid crisis recedes.
Airline losses have been extraordinary. Figures sourced from the World Bank and the International Civil Aviation Organization reveal air carriers lost $370 billion in revenues. This includes $120 billion in the Asia-Pacific region, $100 billion in Europe and $88 billion in North America.
For many of the airlines, it is now a new business model transforming its fleet for cargo demand and launching new cargo routes. The latter also requires obtaining regulatory approvals.
A promising development for the future is sustainable aviation fuel (SAP). Developed by the Air France KLM Martinair consortium it reduces CO2 emissions, and cleaner air transport contributes to lessening global warming.
It is a good start since airplanes are major transportation culprits increasing air pollution and radiative forcing. The latter being the heat reflected back to earth when it is greater than the heat radiated from the earth. All of which should incline the environmentally conscious to avoid airplane travel — buses and trains pollute less and might be a preferred alternative for domestic travel.
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