Readers Question: Has the WTO abused its power?
The WTO is committed to improving free trade amongst its member countries. However, its role has been very controversial - creating polarised views.
These are some of the criticisms of the WTO
- Free Trade benefits developed countries more than developing countries. It is argued, developing countries need some trade protection to be able to develop new industries. The WTO have sought to maintain the same rules for developing countries preventing them from protecting new industries. (This is known as the infant industry argument)
- Diversification. Arguably developing countries who specialise in primary products (e.g. agricultural products) need to diversify into other sectors. To diversify they may need some tariff protection, at least in the short term. Many of the existing industrialised nations used tariff protection when they were developing. Therefore, the WTO has been criticised for being unfair and ignoring the needs of developing countries.
- Environment. Free trade has often ignored environmental considerations. e.g. Free trade has enabled imports to be made from countries with the least environmental protection. Many criticise the WTO’s philosophy that the most important economic objective is the maximisation of GDP. In an era of global warming and potential environmental disaster, increasing GDP may be the least important. Arguably the WTO should do more to promote environmental considerations.
- Free trade ignores cultural and social factors. Arguably a reasonable argument for restricting free trade is that it enables countries to maintain cultural diversity. Some criticise the WTO for enabling the domination of multinational companies which reduce cultural diversity and tend to swamp local industries and firms.
- The WTO is criticised for being undemocratic. It is argued that its structure enables the richer countries to win what they desire; arguably they benefit the most.
See also:
let me ask a question:
Has the WTO been useful only for the developed countries or also for the developing countries? i feel so because the main crux of today’s trade, in my opinion, is the WTO and its principles and policies, to a far extent, have discriminated the developing countries. Apart from the fact that today the WTO has gained much wider ambivalence and prospective, it has been supportive only to the developed nations……….
IS MY CONCEPT RIGHT OR WRONG??????????
That was really very helpful. Thank-you so much to make my project a great success. When I was tensed regarding economics project on WTO, I got sufficient infos from here.
That was really very helpful. Thank-you so much to make my project a great success. When I was tensed regarding economics project on WTO, Igot sufficient infos from here.