The narrowing economic gap between the United States and China has led to growing use of World Trade Organization (WTO) security exceptions, a development requiring a review to prevent abuse of the concept. A balance between these exceptions and free trade must be maintained through restoring the WTO's legislative function, realising the goals of Joint Statement Initiatives and clarifying trade remedy measures.
The rapid narrowing of the economic and technological gap between the United States and China since the late 2010s has triggered confrontation. Because of this, security-based perspectives have shaped various measures introduced into trade and commerce around the world.
The current approach to security issues is one of the most important challenges facing the World Trade Organization (WTO). There is a need to seriously review how to harmonise security and free trade without abusing the concept of security. The war in Ukraine has shown that one area needing to be reassessed is the principle of security exceptions stipulated in Article 21 of the General Agreement on Tariffs and Trade 1994 (GATT).
One issue with adjudicating security exceptions is the ambiguities in Article 21 and a lack of sufficient precedents and deliberations related to legal interpretations. Another issue relates to the increasing instances of the losing party in WTO disputes ‘appealing into the void’ — the lack of a functional Appellate Body rendering disputes suspended until appeals can be heard.
The failure of broad trade rules to develop alongside the needs of the times has led to expanding and abusive invocations of the security exception.