Five Small Countries Fight for MFN Retention in WTO

[ABS News Service/09.11.2026]

A small group of countries – Barbados, Belize, Guyana, Sri Lanka and Suriname – has called for preserving “the centrality of MFN (most-favored-nation) in WTO agreements” to enable developing and least-developed country members to continue securing gains in global trade.

This comes as members discuss foundational issues in the WTO reform track today.

Discussions over the past several months across the WTO Reform’s four tracks – foundational issues, decision-making, development and level playing field – have brought unbridgeable divides in each to the forefront, sources familiar with the developments said.

The five countries recalled the October 12 request by the foundational issues facilitator, Ambassador Sumathi Balakrishnan, to “focus interventions on MFN”.

The five countries stated: “At the end of the meeting, there appeared to be broad recognition that MFN remains a foundational principle of the WTO agreements and a cornerstone for global trade. No Member, including the proponents of change, suggested otherwise.”

The group recounted that “some Members believed, however, that greater flexibility in the implementation of MFN is required to continue expansion and deepening of global trade.”

Without naming these “some Members,” the five countries stated, “these Members proposed that changes in MFN, including expanded MFN exceptions, are needed in order to facilitate trade between Members.”

Burden of Demonstrating Need

Addressing issues raised by some members, the five countries said that “in the discussion that followed, a large number of Members stated that the burden of demonstrating the need for change rests with its proponents, that diagnosis should precede prescription, and that the discussion should proceed on the basis of a shared factual picture of how MFN and its exceptions operate in practice.”

In their November 6 proposal (WT/GC/Reform/W/24), the five countries said they “reaffirm our commitment to preserving MFN as a foundational principle in WTO agreements and to strongly support MFN as a cornerstone of global trade.”

Acknowledging the changes sought by some members for “greater flexibility with respect to the principle of MFN in WTO agreements,” the group said they “seek to actively contribute to these discussions to ensure that the centrality of MFN in WTO agreements is preserved, with a view to ensuring the expansion and deepening of global trade that provides greater opportunity for economic benefits to flow for developing and LDC Members.”

The five countries posed “the diagnostic (evidentiary) queries” to provide “a better understanding of the MFN reform proponents' positions, and will allow us to better consider the proposals for MFN reforms during Reform Month, November 2026.”

Proponents of Greater Flexibility

Seeking “evidentiary substantiation by proponents of MFN-related changes, especially the US,” the five countries said that proponents of greater flexibility in the implementation of MFN indicate the following:

· The existing MFN provisions (if any) in the WTO agreements (GATT 1994 Article 1, GATS Article II, TRIPS Article 4) they propose to change.

· The specific existing exceptions (if any) provided for in the WTO agreements they want to strengthen.

· Additional exceptions (if any) they want to add to the WTO agreements.

· The legal pathway envisaged for each change, and in particular whether the proposal is to amend existing MFN obligations under Article X of the Marrakesh Agreement, to seek an authoritative interpretation under Article IX:2, to seek a waiver under Article IX:3, or to establish a separate plurilateral arrangement, with or without incorporation in Annex 4 under Article X:9.

Proponents should note that under Article X:2 amendments to GATT Article I, GATS Article II:1 and TRIPS Article 4 take effect only upon acceptance by all WTO Members, and that under Article II:3 a plurilateral agreement creates neither obligations nor rights for Members that have not accepted it.

The five countries said: “consistent with the view expressed by a large number of Members that the need for change should be demonstrated by its proponents, and in order to enrich the discussions under this pillar going forward, we invite the Members advancing changes (proponents) to:

· Present concrete, evidence-based justification for the recommended changes. The evidence should relate to MFN specifically and should distinguish the effects of MFN from those of other rules, of non-compliance with existing rules, and of matters being addressed in the Level Playing Field (LPF) track.

· Assess the likely implications of such changes or conditions for developing Members, particularly LDCs and small and vulnerable economies, including the risk of exclusionary barriers or less favorable treatment in key export markets, and identify safeguards to mitigate such risks.

· Explain how the use of preferential trade agreements, as a more prevalent avenue for market access, will not grant a relative competitive advantage for participating economies at the expense of those excluded from such frameworks.

· Assess the risk that small developing economies outside major preferential networks would experience trade and investment shifts toward countries with more secure preferential access, resulting in trade diversion and weaker participation in global value chains, and identify how that risk would be addressed.

· Assess the risk that developing countries, in a more fragmented and geopolitically polarized environment, would face higher adjustment costs and reduced diversification opportunities.

· Assess the risk that any proposed MFN change could lead to market access becoming more influenced by bargaining power, economic coercion or strategic alignment than by uniform multilateral rules and commitments, thereby amplifying structural asymmetries, and identify safeguards against such an outcome.

· Clarify whether and how the proposed changes would affect the Enabling Clause, LDC preferences and the special and differential treatment provisions across the WTO agreements, which were agreed by all Members with defined beneficiaries, scope and conditions, and explain how the integrity of those arrangements would be preserved in the course of any review of MFN exceptions.

· Explain how, in the absence of uniform and predictable MFN tariff treatment across partners, developing countries would avoid higher compliance and customs administration costs arising from multiple tariff regimes and rules of origin, and a widening gap in fiscal and industrial policy space, given that differentiated treatment would oblige smaller Members to secure market access through bilateral concessions on terms set by larger partners.

The five countries called on proponents to “assess and set out in writing the likely effects of their proposals in respect of each of the matters in 2(b) to 2(h).”

Shared Factual Basis Needed

Suggesting responses to these queries “could be useful to inform discussions during and subsequent to Reform Month in November 2026,” the group urged “a shared factual basis for the discussion in relation to MFN.”

The five countries asked the Secretariat to prepare on-the-record data, including:

· a factual compilation of how MFN and its exceptions operate in practice;

· the share of world trade conducted on MFN terms, with the methodology reflected and

· the extent of Members' use of existing exceptions.

Furthermore, once proponents specify the basis for their envisaged changes by responding to the diagnostic queries in Section A, the five countries stated that “members reserve the right to request an empirical assessment by the WTO Secretariat of the likely impact of those changes on developing Members, in particular small and vulnerable economies and smaller exporting Members, with assumptions and limitations stated.”

They cautioned that the Secretariat's proposed work “should remain factual and analytical, with transparent assumptions and methodology, and should not assess the desirability of any proposed change.”

Moreover, the five countries emphasized the need to sequence work on MFN by first addressing “the concrete problem,” and second, that “it should be determined whether that problem arises from the MFN obligation itself, from an existing exception, from implementation, or from another WTO rule.” Additionally, members should examine “whether existing WTO provisions and procedures can address it.”

Therefore, “only then, and only where the problem cannot otherwise be addressed, should any additional flexibility, and the safeguards that would accompany it, be considered.”