Managing Externalities in the WTO: The Agreement On Fisheries Subsidies

ABSTRACT By prohibiting subsidies that support illegal, unregulated, or unreported fishing activities and contribute to the unsustainable depletion of marine resources, the 2022 Agreement on Fisheries Subsidies (AFS) is the first World Trade Organization (WTO) treaty to recognize that a specific trade policy instrument can have adverse consequences for the global commons. We assess the AFS as such and through the lens of the broader challenge confronting WTO members in determining how to address subsidy spillovers and adapt trade policy rules to protect the global commons. While the AFS is a step forward for the WTO, definitions of what constitutes a subsidy and the approach taken to ensure transparency are those that have been part of the WTO since 1995 and have become the cause for contestation and calls for reform. We suggest ways in which birth defects can be addressed while implementing and expanding the coverage of the agreement.