The Omicron scare provided a face-saving way to cancel the Ministerial Conference of the World Trade Organization, scheduled to open Nov. 30 in Geneva. The session was headed for minimal results, joining this year’s Group of 20 summit and the Glasgow Conference on climate change in failing to achieve their goals. The WTO’s inefficiency, China’s growing influence, and the lack of economic-policy consensus within and among national democracies are the principal causes of its endemic gridlock. The WTO’s weakness exemplifies in many ways the end of the post-World War II liberal international order.

The...

A sign for the 12th Ministerial Conference at the World Trade Organization headquarters in Geneva, Switzerland, Nov. 25.

Photo: DENIS BALIBOUSE/REUTERS

The Omicron scare provided a face-saving way to cancel the Ministerial Conference of the World Trade Organization, scheduled to open Nov. 30 in Geneva. The session was headed for minimal results, joining this year’s Group of 20 summit and the Glasgow Conference on climate change in failing to achieve their goals. The WTO’s inefficiency, China’s growing influence, and the lack of economic-policy consensus within and among national democracies are the principal causes of its endemic gridlock. The WTO’s weakness exemplifies in many ways the end of the post-World War II liberal international order.

The liberal trade order that took shape after the war had three primary missions: help revitalize the moribund economies of Europe and prevent the advance of the Soviet communist economic model; build an international system to prevent authoritarian revival in Germany, Japan and elsewhere; and reduce North-South tension by helping raise living standards in the developing world. With strong U.S. support, in many cases to its own economic disadvantage, the system succeeded in the first two goals.

But over the past decade or more, the WTO system has lost its leadership role in expanding a liberal, rules-based global order. This is partly because of institutional sclerosis and poor adaptation to the economic and global landscape. The WTO doesn’t effectively cover such challenges as industrial and agricultural subsidies, forced technology transfer, and rules for newer digital and services economies, including data privacy, cross-border data flows and internet commerce.

Instead of addressing these gaps, European and American political leaders have tried to burden the WTO with new missions such as climate change, human rights and labor standards. These efforts often divide economic constituencies within democracies and further widen the North-South gaps. Negotiations over rules for commercial fisheries, a seemingly simple matter, began more than 15 years ago, and the issue still isn’t resolved.

The WTO conflict-settlement mechanism hasn’t adjudicated efficiently, as seen by the 17-year-plus Boeing-Airbus dispute. WTO technical experts have alienated democratic countries by effectively making new rules without adequate negotiations among members.

The rise of mercantilist China, now the world’s largest economy in terms of purchasing power, is another reason for the WTO’s fading effectiveness. Beijing brazenly flouts its WTO obligations in areas like reporting and limiting subsidies, enforcing intellectual-property protections, and meeting the reciprocal-access obligations it took on in 2001 when it was granted entry to the WTO. Its dominance of global manufactured-goods markets—thanks at least in part to noncompliance with WTO rules—has spurred criticism of the WTO around the world.

India has led developing countries in avoiding full WTO commitments. These nations (including China, which self-identifies as a less-developed economy) demand exceptions to enforcement of WTO rules as they build modern economies. India, with the support of African and South American countries and China, has been an obstacle to new WTO rules, such as for fisheries, and a critic of existing ones, such as rules on intellectual-property rights for medications.

The mature economies of the U.S. and Europe have also begun to revive policies of national self-sufficiency, including industrial, technological and agricultural subsidies. Their own “green” industrial policies, such as tax abatements and tariffs on imports of carbon-intensive goods, further complicate the path to WTO reform on subsidies that is needed to confront Chinese mercantilism. Unilateral actions by the U.S.—sometimes mirrored by the European Union—to address China’s violations of rules, which the WTO can’t or won’t address for political reasons, further weaken the global liberal order. The Biden administration has shown no inclination to pursue WTO reform, concentrating its political efforts on domestic policy. It also now supports India in weakening WTO patent rules for Covid vaccines.

The best approach to reinvigorate the WTO is to strengthen regional trade pacts. The revised North American agreement should admit the U.K. and other allies as members. Japan, Australia and Singapore have expertly led resuscitation of the Trans-Pacific Partnership after the U.S. dropped out in 2017. The new agreement, called the Comprehensive and Progressive Trans-Pacific Partnership, represents the will of its members in East and Southeast Asia and Australia to avoid dominance under a rival group established by China, called the Regional Comprehensive Economic Partnership.

The CPTPP has a good set of old- and new-economy rules, as does the revised North American Free Trade Agreement. Both pacts aren’t weighted down by new responsibilities beyond the traditional missions of building reciprocal trade, or by membership of outliers like China. If the U.S. is serious about confronting Chinese economic dominance and retaining some semblance of a liberal trading system, it would be wise to rejoin the CPTPP and build up regional open-trading areas as the WTO loses its leadership role.

Mr. Duesterberg is a senior fellow at the Hudson Institute. He served as assistant secretary of commerce for international economic policy, 1989-93.

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