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The World Trade Organization and Its Critics

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THE WTO AND ITS CRITICS CASE STUDY What is the WTO? The World Trade Organization (WTO) was established and incorporated in January 1st 1995 at the amendment of the General Agreement on Tariff and Trade (GATT) in 1994 with the aim of regulating international trade. The creation of this organization clearly underscored the acceptance and commitment of trade liberalization by most of the international communities. Upon signing and ratifying the WTO Agreement, each member state of the WTO committed itself through a series of agreements to ultimately liberalize its trade in goods, services and trade-related aspects of intellectual property rights. Each member state signed the WTO Understanding on Rules and Procedures Governing the Settlement of Disputes as well as the Agreement relating to the Trade Policy Review Mechanism (TPRM). This action required member states to periodically subject their national trade and economic policies for examination to ensure that their respective mandates are in keeping with the WTO?s commitments. (Strategic Plan of the Foreign Trade Division 2002). The historical timeline of trade purports that world trade has been ?victim of abuse? by subjection towards high tariffs in the era of the 1930s. The expansion of trade has often played a significant role in the growth of the global economy since World War II, but it was not until the commencement of trade negotiations in the Uruguay Round in 1986, that multilateral trade deals tended to be limited to that of industrial countries. While developing countries benefited significantly from the growth in global trade, they were rarely active participants in the bargaining process (Economic Issues Vol. 37). In 1948, the United States and its principal economic partners which comprised of 23 nations, created the General Agreement on Tariff and Trade (GATT) to promote ?freer and fairer? trade, primarily through negotiated reductions of formal tariffs (Gilpin 2001). After eight extensive rounds of meetings spanning over five decades, the GATT was successful in achieving its objectives of reducing tariffs and increasing world trade (Steiner and Steiner, 2006). ...read more.


It is made up of 54 national and international unions which together represent more than 10 million workers. From 1955 until 2005, the AFL-CIO's member unions represented nearly all unionized workers in the United States. ? Global Exchange This is a membership-based international human rights organization dedicated to promoting social, economic and environmental justice around the world. ? The Institute for Agriculture and Trade Policy This organization seeks to create environmentally and economically sustainable rural communities and regions through implementation of solid agricultural and trade policies. ? Rainforest Action Network This works to protect the Earth's rainforests and support the rights of their inhabitants through education and grassroots organizing. ? Lesser Developed Countries (LDCs) A developing country has a relatively low standard of living, an undeveloped industrial base and a moderate to low Human Development Index (HDI) score. Relatively low capital formation, per capita income and widespread poverty are also associated characteristics of a developing country. Development means ''improvement in a country's economic and social conditions''. More specifically, it refers to improvements in ways of managing an area's natural and human resources in order to create wealth and improve people's lives. Development also triggers change in ?low? value added sectors such as Agriculture and Natural Resource extraction and promotes further growth of physical and institutional infrastructures. These LDCs usually have economic systems based on continuous self sustaining economic growth in tertiary sectors and high standards of living. Examples of these economies are North Korea, China and West Africa. Although shrouded by their own array of qualms regarding global issues, these groups share common ground against the ideologies of one particular organization. Their complaints cover a wide spectrum but moreover their charges converge around the common belief that the WTO extends its power unjustly against their causes. In the following section their grievances are addressed more thoroughly. Complaints The stated aim of the WTO is to promote free trade and stimulate economic growth at a global or a near global level. ...read more.


They also argue that by expanding world trade, the WTO in fact helps to raise living standards around the world. The WTO should not be abolished but should however be tweaked to improvise on some of the decisions made. The following are the issues addressed and the subsequent recommendations that can be implemented. National Sovereignty The organisation should meet with parliamentarians and parliaments within developing countries to discuss proposals and developments as it relates to trade disputes. This would facilitate better negotiations and permit better relations and desirability amongst countries. Undemocratic Practices This requires further inspection to be put in place in order to achieve a balance and resolve in the practice of impartiality. It would also alleviate the hindrance of representatives such as workers, farmers, consumers, communities, environmentalists and human groups who do not have a facet for opinions. Environmental Imperialism In addressing this issue the inclusion of environmental disputes can be involved in the trade proceedings. In doing so this would promote sustainable economic growth and development. Transparency This is a requirement that sits alongside ?Accountability? as a growing concern of organisations by society. It implies candidness and willingness to accept public scrutiny that diminishes the capacity of an organisation to exercise any form of deception or deceit. In doing so, the level of opaqueness will be readily relinquished. Concerns of LDCs Agricultural subsidies and tariffs employed by the rich countries can be improved, as long as the WTO reconsiders the main exports and sources of income of developing countries before making trade decisions that would damage these economies. The WTO?s trade rules intentionally prioritize trade and commercial considerations over all other values. The organisation should treat every country differently because they have different customs, cultures and norms in their environment of business. In doing so this would grant Governments with opportunities to be well informed of decision being made by the various sects of the WTO and encourage the expression of views that influence the outcome of policies and decisions (Steiner and Steiner 2006). ...read more.

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