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Briefly Describe One Important Benefit Of The Wto`s Trade Agreements

by admin on December 4th, 2020

The Aid to Trade initiative, launched in 2005 by WTO members, aims to help developing countries develop trade capacity, improve infrastructure and improve opportunities for trade opening. To date, more than $340 billion has been provided to support aid-for-trade projects. A comprehensive review of the initiative is held every two years at WTOs headquarters. The rules that facilitate the investment process are in the investor`s best interest, as these rules help foreign investors stay ahead of local competition. As several countries, including the United States, strengthen their protectionist positions in trade, the future of the World Trade Organization remains complex and unclear. If fully implemented, the WTO`s first multilateral agreement will reduce trade costs by more than 14% and increase global exports by $1 trillion per year. “The WTO is the operating system of the global economy that ensures that goods and services can be traded daily in a stable, rules-based environment. Even if no organization is perfect, anyone who thinks they can rely on a system of bilateral trade agreements rather than the WTO risks losing a lot of wealth in international trade,” says Christian Bluth, a trade expert at the Bertelsmann Foundation. The WTOs govern the agreements are the result of negotiations between the members. The current series is, to a large extent, the result of the 1986-1994 Uruguay Round negotiations, which included a complete revision of the General Agreement on Tariffs and Trade (GATT). The WTO`s Trade Policy Review Mechanism aims to improve transparency, improve understanding of trade policies followed by WTO members and assess their impact. Many members see evaluations as a constructive feedback on their policies. All WTO members must be subject to regular review, with each revision including reports from the relevant member and WTO secretariat.

In addition, the WTO regularly monitors global trade measures. Initially launched in the wake of the 2008 financial crisis, this global trade monitoring has become a regular function of the WTO, with the aim of highlighting the implementation by WTO members of both trade-enhancing and restrictive measures. The WTO grants each member privileged nation status, which means that WTO members must treat each other equally and must not give any member a preferential trade advantage without giving it to all. WTO members also have lower trade barriers among themselves, including tariffs, import quotas and rules. Larger markets generate more sales, more jobs and faster economic growth. The total membership of the WTO has seen an overall prosperity growth of some $855 billion. This represents an average profit of 4.51% of GDP per member country. But membership in the world club is also a good deal for most countries, in addition to the best winners.

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