Asymmetric Neutrality and the Two Faces of Nonalignment in Pakistan and the UAE within a Fragmenting WTO Order

Abstract The geopolitical competition and the policies on security have created an unprecedented change in the multilateral system of trade, undermining the core tenets of the WTO framework. This article looks at the geo-economic fragmentation of two economies from the Global South in two distinct forms of "neutrality": that of Pakistan and that of the United Arab Emirates. Based on the WTO modelling in the World Trade Report 2026 of a “geo-fragmented world” and the WTO dispute between Pakistan and UAE (DS538), as a microcosm of vulnerability, we contend that non-alignment is not one, but a spectrum of structural capacities. Pakistan's neutrality is passive and defensive, relying on a robust WTO to check the more powerful states and to provide a certain degree of market access. The UAE's neutrality is active and offensive: In its effort to benefit from the flexibility fragmentation brings, the UAE is making use of the Comprehensive Economic Partnership Agreements and strategic positioning in BRICS and WTO. The article draws on these cases to conclude that the WTO's neutrality dilemma is not just an institutional challenge but a shift in the strategic capacity of the states: from dependence on rules to states capable of acting independently. We end with a reform agenda which has "neutrality governance" as a topic of distributive justice, not just great power restraint.