By: Professor Dato Dr Ahmad Ibrahim
Trade is crucial to countries. The economy around import and export contributes significantly to the world. As a trading nation, Malaysia generates substantial revenue from the export trade. Many must still remember when the world was euphoric about multilateral engagement to arbiter trade disputes. The General Agreement on Tariff and Trade, GATT, was a precursor platform to the World Trade Organisation, WTO. Many saw the WTO as the excellent platform to create fair trade among nations. Initially, the initiatives to reduce tariffs were welcome as a way to strengthen globalization which was seen as the panacea for an inequitable world. Things went well until the time it came to negotiate the tariffs on agriculture.
This proved sensitive because many rich nations, notably the EU and Japan, were subsidizing their agriculture. It became clear that subsidy distorts trade and goes against the level playing field. Eventually, the negotiations stalled. Since many developing countries rely on agricultural exports to fund their economies, many felt disappointed with the outcome. The world then reverted back to unilateralism. Is multilateralism dead? Can the world revive it?
In a recent engagement with international trade experts, they are unanimous that multilateralism is not dead. But it is facing significant challenges in the current global landscape. Multilateralism refers to the process where multiple countries work together on shared issues, usually through international organizations like the United Nations, the World Trade Organization (WTO), or the World Health Organization (WHO). Despite these institutions being active, several trends are testing the strength of multilateral cooperation. During the COVID pandemic, for example, the WHO showed that multilateralism is still alive, but shaky.
But many agree rising nationalism and populism are slowly derailing multilateralism. In many countries, including major global powers, there has been a shift towards nationalism. This is exemplified by policies focused on “putting the country first,” which can hinder international cooperation. Brexit and the “America First” approach under former U.S. President Trump are key examples. In fact, when President Trump withdrew the US from the Paris Agreement on climate change, it rattled the world looking for solutions to the impending climate crisis. As Trump appears leading in the current presidential race, the world is getting nervous. As the largest emitter of greenhouse gas, many see the US as pivotal in the world climate actions.
The great power rivalry is the other factor that is killing multilateralism. The growing tension between the U.S. and China has made it harder to achieve consensus in multilateral institutions. Both countries have increasingly prioritized bilateral or regional approaches over global solutions. This inadvertently led to the ineffectiveness of international organizations. There are concerns that some multilateral organizations have become ineffective, slow to respond, or incapable of handling major crises like the COVID-19 pandemic or climate change. This has led some countries to either bypass these bodies or weaken their influence.
Fragmentation is becoming the norm. Instead of global multilateralism, there is a shift towards regionalism or issue-based alliances (like the G7, ASEAN, or NATO), where smaller groups of nations work together on specific concerns rather than through large, global platforms. But global problems are growing more complex. Issues like climate change, refugee crises, pandemics, and cybersecurity threats require collective action. While these challenges should drive multilateralism, the difficulty in coordinating responses across diverse national interests complicates achieving effective collaboration. Working together remains the world’s biggest challenge.
Rather than being “dead,” some suggest that multilateralism is evolving. Some argue that a new form of “mini-multilateralism” or “pluralateralism” is emerging, where smaller groups of like-minded nations collaborate on specific issues. For instance, climate action coalitions or trade agreements among a few nations demonstrate new approaches to collective problem-solving. Thus, while multilateralism is under pressure, it continues to exist in various forms, adapting to new global realities.
Whatever it is, many agree we need multilateralism to resolve much of the world’s challenges. This is where consensus and diplomacy are critical. But multilateralism cannot function effectively if the major powers are not participating. Unless such multilateralism is reinvigorated, there is guarded pessimism that we are heading for more conflicting relations in the future years. That is unhealthy for all.
The author is an Associate Fellow at the Ungku Aziz Centre for Development Studies (UAC), Universiti Malaya, and may be reached at uacds@um.edu.my.