What is the future of the WTO ?

What is the future of the WTO?

        A new era for global trade appears to be emerging. The Western countries are trying to develop a world of free trade to develop the global economy. Free trade is a policy followed by some international markets in which countries governments do not restrict imports from, or exports to, other countries. Different organisations have been created to develop free trade. The biggest one is the WTO, the World Trade Organization. The WTO is the only global international organization dealing with the rules of trade between nations. The purpose of the WTO is to ensure that global trade commences in an easy, free and predicable way. The WTO creates and help countries applicate the legal ground rules for global trade among member nations. It offers an easy and regulate global Trade. There are other free trade agreements like NAFTA, the North American Free Trade Agreement who is an agreement between the USA, Canada and Mexico. The purpose of this agreement is to remove tariff barriers between the three countries. There is also the GATT, the General Agreement on Tariffs and Trade, which governs trade in goods. We are going to focus on the WTO and see what is the future of this agreement.

        First of all, we will define what is multilateral, bilateral and unilateral trade. A multilateral trade agreements are trade regulations between three or more countries. The best example of it is the NAFTA, it is the biggest multilateral trade agreement. It has increased trade 300 percent between it beginning and 2009. The WTO wants to develop this kind of agreement all around the world. This kind of agreements reduce tariffs and make it easier for businesses to import and export. Since they are among many countries, they are difficult to negotiate. The main advantage of it is that it makes all signatories treat each other the same. That means no country can give better trade deals to one country than it does to another. The second benefit is that it increases trade for every participant. Their companies enjoy low tariffs. That makes their exports cheaper, it also standardizes commerce regulations for every country. Bilateral trade agreements are between two countries. It is the same benefit as multilateral but the negotiations take place only between two countries. It generally ended in favour of the country who has the best economy. That puts the weaker nation at a disadvantage. The stronger nation has a more detailed approval process so it is generally less beneficial. Donald Trump wants to replace multilateral agreement to bilateral ones because he is a protectionist and he probably wants the US to dominate the global trade.

        In addition, we saw that he WTO is the organization that deals with the international economy and try to establish free trade between countries. Since the Financial Crisis in 2008, the WTO has been facing a lot of problem. The thing is that countries are challenging the WTO because it has failed. Indeed, this organisation has not permitted the real free trade between every country because free trade agreements are mostly between the USA, Europe and China. So there are a lot of inequalities with the liberal trade. Also, this organization should have prevent the Crisis and find ways to stop it but it failed also with that. We also should know that during the 2008 global financial crisis when tumbling economies and rising unemployment created pressures to protect domestic industries, the WTO was recognized for stopping the threat of trade protectionism. This Organization is well known and recognize but since it has been challenging by countries, it should be careful with some issues.

The most evident issue that the WTO should facing is the Doha Development Round—the current round of multilateral trade negotiations to further liberalize trade and reform the WTO. The Doha Round is focused on reducing the trade barriers in areas such as agriculture, industrial goods, and services. The purpose of it is to make businesses around the world to specialize in the production of goods and services, so they can achieve greater economic status, and increase their efficiency and productivity. Moreover, specialisation permit countries to deliver higher quality and cheaper products to international consumers. It will be a real improvement if most countries focus on that main point. The Doha Round is also going to provide increased market access to goods and services from developing countries. It will help decrease inequality if these developing countries can have access to these market and increase international trade so it is the real purpose of it. Furthermore, according to the "Diplomatic Courier", the WTO estimates that the passage of the Doha Round could increase global GDP by $150 billion per year. It will make global trade increase in a considerable way and be so beneficial for the global economy, international businesses and consumers. The big problem with the "Dora Round" is that it is too ambitious to think that it can happen in the early future, so the negotiations are not really going forward that is why it is a real challenge for the WTO. It is simply naive to believe that this agreement can be easy for countries in the world to accept and to apply. Richer and more developed countries are demanding more and more quotas and special treatment so it makes the work of the WTO harder. More fundamentally, globalization finally has transformed what were once bilateral trade flows into complex trading structures poorly reflected in trade statistics. As countries solve their most pressing trade issues in this way, the incentive to go for multilateral solutions is reduced.

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