WTO plans spending cuts as US falls back into dues arrears
Washington's dues lapse is forcing the WTO to prepare a 10% cut, with hiring freezes and leaner dispute support looming as trade fights intensify.
The World Trade Organization is preparing to trim about 10% from its budget after the United States slipped back into dues arrears, a cut that would hit staffing, dispute support and technical assistance just as tariffs, subsidies and China policy are putting new strain on the trading system.
Internal budget papers show the Geneva-based body planning to reduce spending for 2026 from 204.9 million Swiss francs to 183.4 million Swiss francs. The savings package would include hiring freezes, fewer short-term staff, a heavier reliance on low-cost interns and smaller overheads, including lower electricity costs, as the organization tries to bridge the gap until contributions arrive.
Washington’s return to Category 1 arrears is especially damaging because the United States is usually the WTO’s biggest contributor. Category 1 means a member has gone unpaid for at least one year but less than two years. A February 13 WTO document had removed the United States from the arrears list after a payment, but a March document put it back in Category 1. At a March 4 budget meeting, a U.S. delegate said payments to the 2024 and 2025 budgets were on hold pending a review of contributions to international organizations. The United States was one of 10 members in Category 1 arrears.
The funding problem lands on top of a deeper institutional crisis. The WTO Appellate Body lost quorum on December 11, 2019, after the United States blocked appointments during Donald Trump’s first term, leaving the dispute-settlement system unable to function normally. The organization said it had 20 members under administrative measures at the end of 2025, and a March 12 chairperson statement put the number at 29, including the United States.
The new cut would also reverse recent budget decisions. Members agreed in December 2023 to raise the 2024-2025 regular budget by 3.6% to about 204.93 million Swiss francs after 12 years of zero nominal growth, then later decided to hold the 2026-2027 budget at about 205 million Swiss francs. The latest retrenchment shows how quickly financial stress has spread inside the WTO, just after the 14th Ministerial Conference in Yaoundé ended in impasse on March 30, 2026, when members failed to extend the moratorium on customs duties on electronic transmissions. With the rules-based trade order under pressure, Washington’s arrears now weaken both the institution’s balance sheet and its leverage.
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