Reporting on Global Trade, Transparency, Subsidies, and WTO Reform
The Association of Foreign Press Correspondents in the United States (AFPC-USA), in partnership with the Hinrich Foundation, recently held an educational program that centered on the ways journalists can improve their reporting on transparency, subsidies, and reform at the World Trade Organization (WTO).
The program was moderated by journalist Jennifer Freedman, who for more than two decades has reported on trade and global markets for different outlets. Freedman spoke with María L. Pagán, Senior Research Fellow at the Hinrich Foundation who served as the U.S. ambassador to the WTO during the Biden administration. She was also Deputy U.S. Trade Representative and Deputy General Counsel at the Office of the U.S. Trade Representative, where she worked on trade negotiations, agreements, and regulations.
AFPC-USA is solely responsible for the content of this educational program. Below, foreign journalists can read the takeaways from the discussion.
Pagán explains that transparency is foundational to the multilateral trading system, particularly within the WTO, because the rules themselves have little value if members cannot determine whether other countries are complying with them. Beyond a basic level of transparency, WTO members have specific reporting obligations, including requirements to report subsidies, an issue she considers especially important given the challenges many countries face.
Her central argument is that WTO reform discussions have become so expansive that they risk preventing any meaningful progress. She notes that members often try to address “everything under the sun” at once, resulting in the familiar problem that “we want to do everything all at once and therefore, we do nothing.” Instead, she argues that members should concentrate on improving compliance with existing transparency and reporting obligations. The goal, she says, should be to identify why members are “unable or unwilling” to meet obligations already in place and find practical ways to make compliance easier. Pagán also presents transparency reform as an opportunity to demonstrate that WTO members can still cooperate on a concrete, important issue. She emphasizes that the proposals would not impose additional obligations, addressing concerns from developing countries that they already face too many requirements: “This is already there.” She argues that the focus should be on making the existing system work better “for everybody and for the system altogether,” while using the effort to show both the WTO membership and the wider world that meaningful cooperation remains possible.
Pagán expands on why transparency is “foundational” by comparing the global trading system to rules of a game or rules of the road: countries have agreed how trade should be conducted, but those rules are meaningful only if members can determine whether everyone is following them. She points to the General Agreement on Tariffs and Trade, the predecessor to the WTO, and its Article X requirement that members publish trade-related laws, regulations, and judicial decisions. The basic principle, she explains, is that countries need to know what rules other members have in place and whether those domestic rules are consistent with their international commitments. She distinguishes between two levels of transparency. The first concerns domestic trade rules: businesses and governments need clear, accessible information about what a country requires for goods to enter its market. As she puts it, a trader should be able to know exactly “what I’m supposed to do to get my goods through the border.” The second level involves formal reporting requirements, particularly concerning subsidies. Under the WTO’s agriculture and subsidies agreements, members are required to report detailed information about the support they provide to domestic agricultural and industrial sectors. Those figures are compiled by the WTO and made available so other members can assess whether countries are complying with agreed limits.
She stresses that subsidy transparency matters because government support can distort competition between countries and companies. Some governments have greater financial capacity than others to support their industries, meaning subsidies can create advantages that have little to do with traditional comparative advantage. Industries affected by those policies therefore need reliable information about the support their foreign competitors receive. If a company believes it is being disadvantaged (for example, because another country is heavily subsidizing electric-vehicle manufacturing), it can take that concern to its government, potentially prompting negotiations or a WTO dispute. The information allows governments and businesses to determine whether “there’s a problem” and what, if anything, should be done about it.
ON BEING TRANSPARENT FROM THE START
Maria L. Pagán
Pagán identifies two main reasons why transparency should be the starting point for WTO reform. First, transparency is already an obligation that countries accepted when they joined the WTO, meaning reform efforts would not impose another layer of commitments on members. She notes that developing and least-developed countries frequently object to additional obligations because they already struggle to meet existing ones. Transparency is different, she argues, because it is “what tells everybody, ‘Are you meeting your obligations or not?’” Second, transparency provides the factual foundation needed to determine whether broader reforms are actually necessary. With members examining issues such as subsidies and the perception of an “unlevel playing field,” countries cannot meaningfully revise the rules without reliable information about what is happening under today’s system. In her view, transparency must come first because members need to understand the problem before deciding whether a solution is required.
Asked what the persistent gaps in subsidy reporting reveal about the global trading system, Pagán said: “Well, it’s not very good.” She says transparency varies significantly among WTO members, pointing to the United States, European Union countries, and Canada as examples of systems where government information is generally placed on the public record, even when governments may fail to meet particular WTO reporting obligations. She contrasts this with China, which she says is important to examine because of its enormous role in international trade but is comparatively opaque about government support for industries. This is not simply about criticizing China, she says: because subsidies originate with governments, the governments themselves are often the only entities with a complete picture of how much support is being provided.
That lack of information becomes especially consequential when industries backed by government support expand beyond their domestic markets and compete internationally. Pagán argues that other countries need to know whether the success of a foreign industry reflects genuine efficiency or government assistance that may be inconsistent with international rules. Without reliable subsidy data, it becomes difficult to distinguish between the two. The broader problem, she concludes, is that “if you’re going to find a fix to the problem, you actually have to truly understand what the problem is.” For Pagán, the persistent lack of transparency means WTO members may be attempting to address distortions in global trade without having enough information to fully understand their causes.
Obstacles to WTO transparency are largely a combination of technical, political, and strategic factors, with the specific challenges varying by member, Pagán says. Drawing on her experience at USTR, she explains that even the United States can struggle to gather information from government agencies because agencies can be “territorial” about their data. Although transparency is a longstanding US priority and the country generally manages to complete its WTO notifications, gathering information from individual states can require additional effort. For countries with less-developed domestic systems or fewer administrative resources, the challenge can be greater. While governments facing limited resources may understandably prioritize immediate needs such as feeding their populations over compiling WTO notifications, she notes that this does not explain every instance of noncompliance.
The broader question, Pagán says, is how to encourage members to fulfill transparency obligations they have made. During the first Trump administration, the United States proposed attaching “administrative measures” to persistent failures to submit notifications, similar to consequences that can arise when countries fall behind on WTO dues. These could include restrictions on access to information or participation in meetings. The proposal was not adopted, and Pagán attributed this in part to other members’ reluctance to accept an initiative led by the United States. The issue has since resurfaced, she says, with the European Union proposing that unnotified laws, regulations, or subsidies that harm other members should carry some form of consequence. The United States has built on that idea by suggesting that members affected by an undisclosed measure should have defined rights to respond.
OTHER CONSIDERATIONS
At the same time, she says improving compliance should not be limited to punishment. Developing countries that lack the technical capacity to meet their reporting obligations could instead request assistance, allowing members to address the underlying administrative problems. She questions, however, whether the WTO’s developing-country classifications still adequately reflect members’ economic circumstances. Pointing to China, which formally identifies as a developing country despite being the world’s second-largest economy, she argues that it would be difficult to justify claims that China lacks the resources or capacity to meet basic reporting requirements. Her broader concern is that the traditional developed-versus-developing-country distinction has become increasingly difficult to apply consistently, particularly when it comes to determining who genuinely needs technical assistance.
Trade policy can be a dense and difficult topic to cover accurately, even for well-trained and experienced journalists. Pagán advises journalists covering trade policy to begin by scrutinizing the numbers and asking whether they actually capture the full picture. Although governments report subsidies and other measures, she notes that the data can be incomplete or presented in ways that obscure what is really happening. Agricultural subsidies, for example, can contain enough complexity that countries may be able to “fiddle with the numbers.” She also urges reporters to examine competing explanations rather than simply accepting one government’s narrative. If the United States alleges that China is unfairly subsidizing an industry, journalists should investigate the Chinese data and the subsidy claims, but also ask why the US industry is struggling and whether domestic decisions have contributed to its problems. Governments, she says, will naturally advocate for their own exporters and producers, but “that may not be the entire picture.” Her approach is essentially “trust but verify”: examine both sides, consider whether the reported figures are comprehensive, and recognize that differences in economic performance can also reflect contrasting approaches to industrial planning and investment. Governments, meanwhile, still have to respond to domestic businesses that say they cannot compete because foreign competitors are being subsidized.
Turning to common challenges in trade journalism, Pagán pushes back against describing them simply as reporters’ “mistakes.” Her first point is conceptual: journalists should remember that the WTO is not an independent actor imposing rules on its members. “The WTO is just a building on Lake Geneva,” she says; the organization is ultimately its membership. The rules and major decisions are member-driven, meaning that when the WTO appears unable to act, reporters should ask which members are preventing an issue from advancing and recognize that everyone can sometimes share responsibility. She points out that the United States and India, among others, strongly emphasize the member-driven nature of the organization, while the European Union approaches the concept somewhat differently because it is itself an international grouping of member states.
Pagán cautions against covering the WTO only through its failures or deadlocks. She points out that members continue to meet reporting obligations, substantial international trade still operates under WTO rules, and committee-level work regularly produces progress on technical issues. She highlights areas such as sanitary and phytosanitary measures and technical barriers to trade, where highly detailed discussions can determine whether a product is able to enter another country’s market. Much of this work depends on transparency: when a member discloses a new regulation, other countries can examine it and discuss whether it is unnecessarily restrictive or could be improved. For journalists, she suggests that these less-visible processes are important parts of understanding what the WTO actually does. She argues that there is no literal system of completely free trade and that WTO rules are instead concerned with the degree of openness between markets and the conditions or hurdles that goods must meet to enter another country. Trade agreements reflect governments negotiating how they want commerce to operate, while those same governments remain accountable to domestic constituencies. That creates an inherent tension between encouraging international trade and responding to domestic interests. Understanding trade disputes therefore requires journalists to look not only across borders but also within countries: who benefits from a particular policy and who does not, and what domestic economic and political pressures are shaping the government’s position.
BEST PRACTICES FOR REPORTING ON TRADE
She advises journalists covering trade to resist jargon and keep asking what specialized terms actually mean and why they matter. She points to the WTO website as a useful resource because it provides information designed to make complex subjects more accessible, but she emphasizes that journalists should also be skeptical of language that appears authoritative simply because it is technical. During her time representing the United States at the WTO, she saw how diplomats from countries where trade was not their primary portfolio sometimes relied heavily on prepared talking points and acronyms. She does not suggest they necessarily lacked understanding, but argues that journalists should still ask whether the person using a term genuinely understands its implications. Her rule is essentially to keep asking, “What does that mean and why is it important?” Even familiar concepts such as “most-favoured-nation” treatment, she says, should not be treated as beyond question simply because they are longstanding principles. Journalists should push officials to explain trade policy in plain English and, ultimately, make clear why an issue matters to people in their own countries.
She used the auto industry as an example of how a transparency failure at the WTO could have consequences for people far removed from Geneva negotiations. Without reliable information about foreign subsidies, American auto workers and companies may not know whether they are losing business because competitors are genuinely more productive or because those competitors are receiving government support that gives them an unfair advantage. Pagán says the same concern extends beyond automobiles to major industries such as steel and aluminum and is increasingly visible across a much broader range of sectors. She also points to China’s continued presence across both advanced and basic manufacturing as an illustration of why transparency matters internationally. China has moved into industries such as electric vehicles and batteries while continuing to produce toys, textiles, and other lower-value goods. Pagán argues that this creates significant difficulties for developing countries that traditionally compete in those basic industries. As Chinese firms move into higher-value sectors without fully withdrawing from the lower-end ones, there is no obvious market space for other developing economies to occupy. She cites economists who have described this dynamic as the “China squeeze”: China’s expansion across the industrial spectrum can put pressure on countries that depend on sectors such as toys and textiles, demonstrating how questions about subsidies, competitiveness, and transparency can ultimately affect workers and economies far beyond the WTO itself.
Pagán offers journalists a simple way to test whether a trade minister’s stated support for transparency and WTO reform is backed by action. Her first question is whether the government has actually met its reporting requirements. The second is whether it is participating in the current discussions among WTO members about improving compliance, including proposals from the European Union and the United States. She emphasizes that the debate is not primarily about creating new obligations, but about finding ways to encourage members to fulfill commitments they have already accepted, including through incentives for compliance and potential consequences for noncompliance. Her third question is whether the government itself has made any concrete proposals on the issue. Together, these questions can distinguish general expressions of support from actual engagement and action. When asked whether transparency reform could improve disclosure while leaving underlying inequalities untouched, Pagán agreed that it could, but argued that better transparency is nevertheless a necessary first step. Before members can meaningfully negotiate changes to substantive rules, they need reliable information about what is actually happening. She points to agricultural subsidies, which have been debated at the WTO for decades without resolving the fundamental disagreements. She says members cannot make meaningful progress on substance if they do not first have a clear understanding of the current realities: “You cannot move on substance if you don’t have a better lay of the land.”
The most important source of that information is the WTO membership itself, Pagán says, because governments are responsible for reporting their measures. Other institutions, including the Organisation for Economic Co-operation and Development (OECD), are also examining industrial subsidies, but some WTO members question the neutrality of OECD data, arguing that they reflect the perspective of developed economies despite the organization’s collaboration with many countries. For Pagán, this reinforces the case for members to improve transparency within the WTO itself. She also sees such reform as potentially valuable beyond the immediate information it would provide. Because transparency obligations already exist, successfully improving compliance could give members a tangible example of cooperation and demonstrate that they are still capable of accomplishing something together. That success, she argues, could build confidence for tackling more difficult reforms — a sense that “we were able to accomplish something by working with each other.” In her view, that confidence is “sorely needed at the WTO.”
Pagán urges journalists to distinguish between legitimate confidentiality and broad claims that are used to avoid disclosure. Firm-specific commercial data, she notes, are generally recognized as deserving protection under WTO rules. National security can also justify withholding genuinely sensitive information, such as details about weapons systems or specific military capabilities. But she argues that invoking national security does not necessarily excuse a government from explaining the underlying issue or providing less-sensitive information. The appropriate response, she says, depends on exactly what information is being sought and why the government considers it sensitive. When journalists believe officials should disclose more, Pagán’s advice is persistence. She notes that the United States has spent years pressing WTO members for information on subsidies and other measures, and that the problem predates any particular administration. One tool available to members is a “counter-notification,” which allows a government to use information from other sources to estimate what another member has failed to report, then formally present that information, and ask the member to confirm or correct it. Pagán acknowledges that such information can be imperfect, but says it creates an opportunity to force the issue into the open and begin a discussion. She also cautions that publicly “naming and shaming” countries does not always produce compliance, which is why the United States and other members have explored more formal incentives and consequences — the “carrots and sticks” needed to encourage governments to fulfill obligations they accepted when they joined the WTO.
THE CONSEQUENCES OF MISSING INFORMATION
When she was asked for an example of how missing information can obstruct negotiations, Pagán recalled the WTO talks on fisheries subsidies. Negotiators had data from an international organization showing levels of subsidization for distant-water fishing. Some countries appeared near the top of the list of subsidizing nations, including several developing countries whose representatives disputed the figures, arguing that their fishing operations were much smaller than the data suggested. Pagán’s response was essentially that if the figures are wrong, “then tell me” why. But governments were reluctant to provide the underlying information because doing so could potentially confirm the very figures they wanted challenged and affect the negotiations. All in all, her decision to share this underscored how difficult it is to reform a practice without reliable information. The data could have been wrong, and a country may genuinely have been mischaracterized. But without governments providing enough information to test the figures, negotiators could not establish what was actually happening. That creates a difficult incentive problem: the very countries disputing the data may have little reason to disclose information that could validate the original findings. Her broader point is that if negotiators want to address a practice that is harming other countries, they first need reliable information about who is responsible, how serious the problem is, and whether the available data are accurate.
Pagán agreed with a journalist that WTO reform should include changes to how the organization conducts its work, while emphasizing that members themselves are responsible for those practices. She says governments that criticize the WTO should also be asked what they are doing to address its problems; in the case of the United States, she notes that despite its criticisms, it remains actively engaged in the organization. She says the consensus rule is one of the toughest issues. In her view, consensus cannot simply be abolished because WTO rules can create binding obligations and expose members to dispute settlement, making it problematic to impose new commitments on a country that has explicitly objected. At the same time, she acknowledges that consensus has effectively come to resemble unanimity in practice, with individual members able to prevent progress. Rather than attempting to overhaul the entire system at once, Pagán suggests experimenting with narrower procedural changes. She notes that WTO agreements already provide for voting in certain circumstances, although using it more broadly could quickly become contentious. A more practical approach, she argues, would be to test alternative procedures in limited areas, evaluate whether they work, and expand them only if the results are successful. Her frustration is that WTO members often try to solve everything simultaneously and consequently accomplish little. She believes incremental experimentation carries less risk because if a change does not work, members can abandon it and try something else.
She was similarly critical of the WTO’s traditional distinction between developed and developing countries. Pagán views the category as increasingly outdated, particularly because a large majority of WTO members identify as developing countries despite enormous differences in their economic circumstances. She distinguished least-developed countries, which have a formally recognized United Nations classification and, in her view, can reasonably continue receiving special treatment, from the much broader developing-country designation. The latter includes some of the world’s largest economies, creating questions about how meaningful the classification remains when determining trade commitments. She argues that the distinction has become an obstacle to progress on issues including special and differential treatment because it no longer accurately reflects the economic diversity of the WTO membership.
COMPARING COUNTRIES ON SUBSIDIES
Comparing countries on subsidies is inherently difficult when the underlying quality of disclosure varies, Pagán notes. In fact, she argues that the WTO’s dispute-settlement system can itself discourage transparency because governments may fear that disclosing detailed information will make them vulnerable to legal challenges: “You don’t want to disclose your dirty laundry.” The asymmetry is particularly striking because the party bringing a dispute must prove its case with evidence, while a less-transparent government can withhold information and leave its opponent at a disadvantage. She uses the United States as an example of how transparency can create exposure to litigation. US agencies such as the Department of Commerce and the International Trade Commission are required to make their decisions publicly available, meaning their anti-dumping and countervailing-duty determinations can be scrutinized and challenged in detail. Challenging countries that disclose less information is harder because the evidence needed to establish a violation may not be available. This raises a fundamental question about whether WTO rules operate equally for members with very different levels of transparency, she says. In her view, they do not necessarily have the same practical effect on countries that are highly transparent versus those that are not.
On the subject of evaluating government allegations about foreign subsidies, Pagán again stresses the importance of accessible underlying data. Journalists should not simply accept an accusing government’s interpretation; they should look for information from the other government or independent sources that can confirm, contradict, or contextualize the claim. But she cautions that the issue is more complicated than comparing two sets of numbers. WTO subsidy rules are technically complex, and disagreements can involve how data are interpreted as well as the figures themselves. The key journalistic question, therefore, is whether enough information is publicly available to independently test an allegation, such as whether a claimed subsidy is actually at one level rather than another.
Asked what investigation she would assign an international correspondent today, Pagán pointed to industrial subsidies, particularly those involving China. She acknowledged the OECD’s extensive work in this area while stressing that journalists should still ask whether the conclusions and underlying data are correct. One particularly important question, she says, is identifying who is actually providing the subsidy. She recalls disputes involving Chinese banks that were government-owned and government-directed but were nevertheless treated in litigation as not necessarily acting in a governmental capacity. For journalists, that means examining who is “behind providing this leg up,” whether the assistance actually gives an industry an advantage it would not otherwise have, and whether there are alternative explanations for the industry’s success. Her broader advice is consistent with her earlier emphasis on verification: “Don’t take what government people tell you.” A government’s account may be accurate, but journalists need evidence to verify it.
FINAL THOUGHTS
As the conversation came to a close, Freedman asked Pagán what she hopes journalists ultimately take away from her research. Pagán says transparency is essential because the global trading system is supposed to allow countries and businesses to understand what the other “players” are actually doing. She explains that WTO rules were largely designed around a market-economy model in which market forces determine where economic activity goes, while governments intervene to guide or constrain those forces. If a country’s economic system is structured in a substantially different way and its government support is also opaque, other countries cannot accurately assess what is driving competitive outcomes.
Her central concern is that comparative advantage should reflect genuine economic strengths rather than simply which government has the resources to provide the largest subsidies. “Comparative advantage should not be who’s got the money to subsidize,” she notes. And this means journalists should remember transparency is therefore not merely a technical WTO issue. It is necessary to understand whether the global trading system is functioning according to the principles its rules were designed to support. Pagán reiterated that transparency is “so fundamental and so important for the system to operate.”
