The World Trade Organization and global climate-change negotiations face comparable challenges. Both need to accommodatedifferent levels of development and match them with appropriate obligations.Even the jargon is similar: “common but differentiated responsibility” in theclimate-change talks, and “special and differential” in the WTO.

Similarly, the classic North-South divide that shapes both sets ofnegotiations recalls the era when “North” was a synonymfor “rich,” and “South” was shorthand forthose who could not afford to play by the same rules. The world has changeddramatically since then, and in the climate-change negotiations it is nowaccepted that some developing countries will need to undertake emissionreductions by 2020.

The WTO is a step behind. Based exclusively on its own self-assessment,any member can claim to be “developing” and remain at that stage, which automatically entitles them to the benefits of“special and differential” (S&D) treatment. That translates into derogations from general rules and longer periodsto introduce less ambitious tariff reductions.

Assigning “common but differentiated responsibility” for climate change isbasically a question of allocating mitigationcosts between countries responsible for accumulated CO2 stocks and thoseresponsible for current CO2 flows. In the WTO, the challenge is one not ofmeasurement, but of leveling the playing field toensure “fair” competition and an equitabledistribution of the short-term costs of tradeliberalization.

Imposing “lighter” trade obligations on developing countries makes sense,because opening markets to competition implies that some uncompetitiveindustries may disappear faster than the economy can reabsorbthe displaced labor and capital. Developingcountries typically lack the fiscal resources needed to facilitate thetransition, so they get more time to adapt, as well as less ambitious targets.Without this deference, it would bedifficult to marshal support for tradeliberalization, particularly from democratic governments.

Most people accept the need to grant S&D treatment to developingcountries. But for how long should they receive it?

The process of “developing” is, by definition, dynamic, so deference must be temporary. But, obvious as thismay be, the WTO still needs to acknowledge the provisionalnature of S&D treatment. The WTO has 157 members, of which only 35 are“developed” countries, while 122 are “developing” (including large “emerging-marketeconomies,” or EMEs).

There are no graduation criteria and no rules to tell when a WTO membercould be weaned from S&D treatment. Notsurprisingly, no middle-income country has ever felt the need to surrender itsbenefits. This state of affairs is all themore remarkable given that countries in more direneed of support, the “least developed” category (a sub-group of “developing”countries that is entitled to additional benefits), can be forced out of thatcategory when their per capita income surpasses a certain threshold. Asa consequence, several new country groupings have mushroomedwithin the large category of “developing” countries in order to allow for more tailored S&D treatment.

For the last 10 years, while the WTO was struggling with multilateralnegotiations known as the Doha Development Agenda, the dynamics of the globaleconomy have made the “developing” inconsistency even more apparent. In 2001,less than half of global economic growth was attributable to “developingcountries,” including China,India, Brazil, andothers. Nowadays, they account for almost 80% of global growth.

Likewise, unemployment today is higher in OECD countries than indeveloping countries (8.6% versus 6%); the average fiscal deficit in advancedeconomies is three times higher than in “developing” economies (6.7% of GDPversus 2.6%); and their total financing needs (maturing debt plus the budgetdeficit) in 2012 are four times that of EMEs (27.7% of GDP versus 7.7%).

Do these figures mean that large EMEs are in a position to relinquish at least part of the benefits ofS&D treatment? The answer need not be black or white. Competitiveness isnot necessarily uniform across all industries (for example, an EME can be verycompetitive in agriculture but not in manufacturing), and large segments of EMEpopulations are still living in poverty. Yet it is increasingly difficult toargue that all developing countries need to enjoy a nearly unrestricted rightto opt out of WTO general obligations.

Several WTO “developing” countries are now net creditors, lend massiveamounts of money to the United States Treasury, and are courted by European countries in financial distress. At theIMF, they are successfully arguing that their increasing economic weight shouldentitle them to larger quotas and more votes, and at the climate-changenegotiations they have rightly accepted that they will need to assume reductioncommitments.

All of this should be celebrated, and the multilateral trading systemdeserves part of the credit. But the WTO also needs to accommodate divergentconditions and stages of development. Making room for reality would reinforceS&D treatment by giving more meaningful benefits to the countries that needthem most.