关于WTO的澳洲指导coursework

Wto is the main international entity
 

The World Trade Organization (WTO) is the main international entity that negotiates using the rules of trading between the world nations. When trade is allowed it opens up foreign markets for domestic producers. It also opens up the possibility of foreign competition in domestic markets. This fact will lead to the reduction in price of many products, which will benefit the consumer. Trade restrictions hurt the consumer, and this is a problem that the WTO is charged with addressing.

 

In the 1980's when Japanese cars were quickly gaining a foothold in the American market the U.S. limited the number of imports from Japan, in theory to protect the American worker. In response to this, car prices rose extremely. If the imports were to be allowed into the United States it would no doubt have a short-term negative effect on the economy. This would all change however when a shift in the economy occurred or the American producers were forced to make better products which in the end will benefit the costumer. The long-term benefits, although hard to see by many politicians, would benefit the United States in the long run.

 

The WTO also makes life much simpler for companies wishing to import raw materials from outside their own country in order to make finished goods through Non-discrimination. If the WTO did not exist then many countries in all likelihood would have different import duties applying to different nations. Therefore if a company from any country wanted to import a raw material it would not be a simple case of comparing prices. The company would have to make calculations and study the regulations of buying from certain countries making life much more complicated than it has to be. Since the rules of the WTO apply to all member countries there is no confusion about the import duties and companies can choose simply from the cheapest producer thus making the final product cheaper for the consumer.

 

Aside from the WTO's involvement in the trading of goods it also regulates services and intellectual property. The service sector which includes banks, telecommunications companies, tour operators, hotel chains and transport companies, can now enjoy the same freedoms that were originally intended for the benefit of goods being imported and exported between countries. These services are now free to open business abroad. Intellectual property has gained the same benefits under the WTO. Things such as copyrights, trademarks, geographical names used to identify products, industrial designs, integrated circuit layout-designs and undisclosed information are now protected when trade is involved.

 

Disputes between countries can now as well be solved with the WTO. If a country has a problem with another country's trade practices it can settle it through consultation. If that fails there is a mapped out, stage-by-stage procedure that includes the possibility of a ruling by a panel of experts, and the chance to appeal the ruling on legal grounds. So if a country feels another country is treating it unfairly it can use the WTO to solve the problem.

 

The World Trade Organization has been a great example of the way collective responsibility works. It has lived up to its expectations of making fair trading rules by getting countries together on an international, open forum, and letting the countries decide what is best for them. Since its birth in 1995, the World Trade Organization (WTO) has solved about three hundred disputes. These disputes have shown that the World Trade Organization really works in an unbiased way, without any external pressure, force or control. Two of the most depicting examples of the World Trade Organization's impartial working are “Standards for Reformulated and Conventional Gasoline”, and “Import Prohibition of certain shrimp and shrimp products”, which have proven that the World Trade Organization has been a success.

 

One of the first disputes brought to the World Trade Organization was in 1995. The case, referred to as DS2 (“Standards for Reformulated and Conventional Gasoline”), was filed by Venezuela, along with Brazil against the United States (http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds2_e.htm). The United States had applied stricter restrictions on the chemical composition of gasoline it imported from other trading partners than on domestically refined gasoline. Venezuela filed a complaint against the double standards adopted by the United States, which were in violation of the WTO's trade rules and trade agreements that called for fair trade. Venezuela presented its case, stating that these restrictions meant they had to use more advanced technology, which increased their cost of refining (production), making it harder for them to import their oil in the United States at a reasonable and competitive price. This, de facto, affected the sale of their gasoline as the final market price was higher than domestic US-refined gasoline. The Dispute Settlement Body, a sub-division of the WTO that handles disputes and complaints, set up a panel for this report that ruled in favor of Venezuela. It recommended the United States to either increase the restrictions on their domestically refined gasoline or to decrease the restrictions on imported gasoline. The United States exercised its right to appeal against a panel recommendation, and asked the Appellate Body, another sub-division of the WTO that hears appeals, to reconsider the findings and the recommendations of the Dispute Settlement Body in February 1996. The Appellate Body looked into the case again and upheld the panel's decision in April 1996. The United States finally agreed to abide by the ruling. In August 1997, it reported to the Dispute Settlement Body that it had adopted their recommendation by removing the extra restrictions on the chemical composition of imported gasoline (Frost, 20). The outcome of this case set a precedent for many other cases, where it was shown that the World Trade Organization gives equal voice to every member nation, and treats it equally, without considering its economic status and level of development.

 

The World Trade Organization had always stood for what is right and fair. Many cases have involved the exploitation of Newly Industrialized Countries (NICs) and Low Developed Countries (LDCs) by High Developed Countries, which use their position and status unfairly. The World Trade Organization has come to the rescue of these NICs and LDCs umpteen times. It has always sided with the right party. The World Trade Organization has a long history of making rules that exhibit fairness and equality. One of the main goals of the World Trade Organization is to help in the economic development of Newly Industrialized Countries and Low Developed Countries. It has made rules that do so.

 

Another major example of WTO's success in achieving its goals has been the “Import Prohibition of certain shrimp and shrimp products” dispute. Referred to as DS58, this case was filed by India, Malaysia, Pakistan, and Thailand, against the United States in October 1996 (http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds58_e.htm). There were also about 25-30 member nations that were third parties to it. The 4 complainants stated that the United States was being unfair by applying specific restrictions on the import of shrimp. The United States imported only that shrimp which was caught using a certain device called Turtle Excluder Device (TED) that made sure no sea turtles were caught in the process. The US followed this policy keeping in line with the world agreement over protection of endangered species, in this case the sea turtles. But the issue here was that only the US had the technology, knowledge and manufactured these Turtle Excluder Devices. Thus, the US agreed to buy the shrimp of other countries if it had been caught using TEDs bought from the US. The complainants protested that this was unfair. The buying of these TEDs increased the cost of catching shrimps and this caused higher export prices, which led to low purchase of imported shrimp in the United States. The DSB panel gave a report that keeping in view environmental concerns, asked the United States to give the technology and knowledge to manufacture these devices. The United States agreed with the recommendation and helped these countries manufacture their own Turtle Excluder Devices. This case demonstrates that the World Trade Organizing favored with the right party, even though the other party was an economic superpower. This also showed how the World Trade Organization not just cares for economical aspects of trade issues, but also for other aspects, like environmental one in this case.

 

The above two examples give a strong and good indication that the World Trade Organization has been able to achieve its goals of fair trade without any bias or prejudice.

 

The Doha round is a trade negotiation which started in 2001 by the World Trade Organization. Its main objective is lowering trade barriers from around the world, which in turn will allow different countries to increase global trade. From 2008 the Doha round talks have slowed down due to issues from agriculture, tariffs, services and trade. The most differences lie between developed nations from the European Union, United States and Japan against developing nations such as Brazil, Africa, China and India.

 

When the General Agreement on Tariffs and Trade was transformed into the World Trade Organization during the Uruguay Round in 1995, developing countries felt defeated because they believed the terms outlining the system are favourable to the developing countries. Refusing to attend another series of talks under the Uruguay Round, it was decided that a new set of negotiations could only be launched in Doha, Qatar. The Doha Development Round began in November 2001. The primary purpose is the lowering of trade barriers around the world, allowing for free trade to flow between developed and developing countries, giving poorer countries better access to markets of their rich counterparts. It was originally planned that the negotiations and hammering out of the free trade deal terms would take place within four years, before the expiration of the U.S. President's Congressional Fast Track Trade Promotion Authority -- a special power that enables the American leader to negotiate trade deals with other countries that Congress can choose to ratify or not, but can't amend or delay in their passage. Without this power, Congress can choose to amend trade agreements, which could make other countries more reluctant to engage in further talks.

 

After the ministerial-level meeting in Doha, Qatar, leaders of the representative nations met subsequently in Cancun, Mexico in 2003, Geneva, Switzerland in 2004, Hong Kong in 2005, Geneva again in 2006, and Potsdam in Germany in June 2007.

 

The Cancun talks collapsed after four days because the countries couldn't agree about market access and farm subsidies. The succeeding Geneva negotiations proved better for a framework to open global markets were drafted. The nations also reached an agreement to end export subsidies, and lower agricultural subsidies and tariffs. During the ministerial round in Hong Kong, government leaders set 2013 as the deadline to end subsidies on agricultural exports. Further, it was resolved that industrialized nations will open their markets to poorer nations' goods and products. The result of this round proved satisfying to the World Trade Organization, raising hopes that a final trade deal could finally be forged during the final round in 2007. However, hopes were dashed when the June Doha ministerial meeting collapsed due to the obstinacy on both sides regarding their positions on agricultural subsidy cuts and tariff issues.

 

On October 9, 2007, Director-General Pascal Lamy, Chairman of the Trade Negotiations Committee reported that negotiations have moved forward again after it was stalled in June 2007. The proposal on how to cut subsidies has been submitted by New Zealand's Ambassador C Falconer, the chair person involved in the agriculture negotiations (fao.org). In a 45-page draft, the ambassador proposed some formulas to cut tariffs and trade distorting subsidies, with related provisions. The document took into account the World Trade Organization's member governments' latest stands regarding the talks. After the standstill, the negotiating panels welcomed another intensive series of meetings in order to resolve the impasse and reach and sign the agreement at the soonest time possible (genecampaign.org, 2008)

 

The WTO's chief agriculture and industrial negotiators had postponed the compromise proposals they had planned on delivering. The proposals where expected early 2008.

 

Observers contradicted in reports WTO's optimism that a DOHA trade deal is doable in the next two years. The observers said that there is little possibility of the DOHA round being concluded within the next two years, given the rich and poor nations' wrangling on cutting farm subsidies and manufacturing trade barriers.

 

The DOHA ministerial-level meeting held in June 2007 collapsed over disagreements on agricultural subsidy cuts. While the developing nations insisted on cutting farming subsidies, their rich counterparts want to ensure that the lower tariffs in developing nations would compensate for farm subsidy cuts at home. Negotiations where once more in progress to study and probably amend the draft provided by New Zealand's Ambassador Crawford Falconer. The June 2007 Rounds came to a standstill as a result of a deadlock between the developed nations -- led by the European Union, Japan, and the United States members, and the major developing countries represented by China, India, South Africa, and Brazil. The 2008 talks would have concluded the Doha Development Agenda, opening the manufacturing and agricultural sectors, and expanding intellectual property rules and services negotiations.

 

The leaders of developing nations, which include China, Brazil, and India, set a meeting in the WTO's headquarters in Geneva beginning November 2008 to discuss and reiterate their stand that industrialized countries should concede on lowering farmer subsidies in their countries. However, developed countries like the U.S. and Belgium have been openly criticizing Brazil, India, South Africa and other developing nations for refusing to agree to open their own markets to goods and products from developed countries, while constantly pushing the richer nations to accept tariff free goods from them.

 

The sixth ministerial meeting took place in June 2007 in Potsdam, Germany.

 

As of the ministerial-level negotiations, no agreement has been concluded. The last round of negotiations was hoped to settle the issue of lowering subsidies provided by the United States and the EU to its farmers. However, both parties will not compromise on this issue, resulting to the collapse of the negotiations.

 

The leaders of Brazil, South Africa, China and India have reaffirmed their commitments to further engage in negotiations to reach an agreement that is acceptable and equitable to all parties involved. They recognized that the Doha Round has entered a critical stage and needs more work to be able to draft the terms for a free trade agreement. They also emphasized that solving the agricultural issues is of the highest importance in order to conclude the rounds. Once more, they called on the developed nations to agree to subsidy cuts to level the field for farmers from poorer countries. Subsidies from the government gave growers opportunities to lessen their prices, which is something poorer governments can't afford to provide.

 

The difficulty involved in reaching a deal is due to the fact that developing countries, while demanding trade cuts on agricultural products, refused to lower their own tariffs. Peter Draper, a research fellow at the Institute of SA International Affairs, said Business Report, that a group of 33 developing countries was "very reluctant" to make concessions. To protect their own people, the EU and its counterparts are looking for an exchange that would not put their own producers at a disadvantage. They maintain that their products and goods should be levied lower tariffs in developing nations' markets.

 

Developing countries have argued that it was the EU and the U.S. that are causing problems by being protective of their markets using tariffs and providing generous support for producers, at levels which developing countries could hardly match.

 

The aim of the world trade organization at least as stated is the promotion of free trade and the stimulation of economic growth. However according to some in the economic circles it has been argued that free trade does not guarantee economic prosperity. In fact it promotes duality, that is, the rich becoming richer and the poor becoming poorer.

 

‘Benefits of eliminating global trade barriers on developing countries; Importance of reducing global poverty; Average manufacturing tariff rates applied by developing countries' (Cline, William R).

 

The countries that are participation in the Doha Round talks all believe there will be some economic benefit to be gained from an agreement. But also at the same time there is disagreement to how much benefit will be produced from the agreement. The University of Michigan U.S. did a study Doha Round agenda and found that is there was a 33% reduction in all trade barriers from agriculture, services and manufacturing this would result in an increase of global welfare up to $574.0 billion (Brown, Deardorff and Stern, 2002). A study by Kym Anderson in 2008 who is a World Bank leading economist found income throughout the globe would increase to a staggering $3000 Billion a year, but with $2500 billion per year going to the developing nations (Anderson, 2008). Many experts have a much more modest prediction, for example, by 2015 would the world's welfare net gains range $84 billion to $287 billion a year (Thomas and Keeney, 2005). The leader of the WTO Pascal Lamy has estimated that the Doha Round deal will produce $130 billion increase per year (Jonathan, 2009).

 

The Doha Round should be achieved for two main reasons. The first reason is to implement tariffs and reforms from the Doha Round text drafts and keep the substantial gains already agreed. Secondly, they need to make sure the rule based trading system is viable. If trading solutions are put on hold, governments who are pressured by domestic situations may go elsewhere to resolve trade and investment problems. Failure from the Doha Round to reach a deal could cause serious harm to the credibility of the WTO as a negotiation force and in turn this could undermine over time the value of the WTO's dispute system.

 

Failure to deal is very worrying due to the global financial and global crisis in 2009 which has now spread in to 2010. High amounts of unemployment throughout the globe due to the current recessions has spurred immense pressure on the WTO to .take forward the talk on Doha Round and as a result all world leaders in the g-8 summit of July 2009 have agreed to conclude the Doha Round talks during 2010. The world leaders stated a successful round will revive the global economy and if the talks fail the developing countries will lose the most.

 

Also, Pascal Lamy suggests failure at the Copenhagen talks in December 2009 in finding an agreement on climate change will threaten the international trading system. He suggests a failure or break down of discussions about the environment from green house gases could overlap in to the trading talks as some countries may have products removed from trade due to high green house gas emissions. Pascal Lamy suspects if the Copenhagen talks fail this will result in complications for the WTO.

 

The WTO have been accused in the past of too much supporting the richer and industrialized nations rather than the poor or agro-based ones.

 

WTO critics claim that the developing countries wield little influence in the regime. Martin Khor argues that the WTO is biased towards the richer nations and this has been partly due to the fact that poorer countries have little influencing power. For example, a treaty between Thailand and the US would inevitably favour the stronger of the two nations.

 

An example of this bias can be Rich nations imposing high tariffs on the poor ones thus affecting the latter's exports. The imposition of non-tariff barriers such as anti dumping duties also hurt the poorer nation's further highlights this issue. The richer nation's protection of agriculture is criticized while the poorer nations are pressed to open up their agricultural markets. Also, many countries did not have the capacity to flow the negotiations in the Uruguay round (Khor, 2002).

 

Khor argues that the Northern nations do not follow their contracts as perfectly as they should. He also says that the Doha round ventured from its initial proclamation of a development friendly negotiation to that of one in which the poorer nations were simply pressurized to open up their markets. However, according to Jagdish Bhagwati, there are also many tariff protection measures n the developing countries that are used to protect their own industries, Thus we see that discrepancies seem to be in both the hemispheres (Bhagwati, 2005).

 

Also, many analysts including Steve Chamovitz argue that the WTO should begin to address the issues of environment and labour as well. He argues that the gains from increased trade might be more than offset by the environmental damage they cause.

 

However, no matter how much the WTO has been criticized, it is still respected among the world. In March 2002, the US government imposed a tariff of about 30% on all steel related imports from the EU. The tariffs were imposed when a US trade body found that there has been a surge in imports of related products from the EU. However, the WTO ruled out any tariffs and said that there was no real surge of imports. It is widely believed that the origin decision to impose the tariffs was originally based on winning the support the Virginia steel workers. But since the blatant breaking of WTO rules would be a taint on President Bushes election campaign, he dropped the tariffs. Furthermore, WTO regulations would mean that the EU would itself impose retaliatory tariffs and this would cost the US $2 billion annually. Thus we can judge the power the WTO still wields in the international trade arena from this incident.

 

Many argue that the decision making process in the WTO is one that is very cumbersome. They say that all the diverse opinions, interests and objectives have made the process of ‘consensus building' all the more tedious. Furthermore, the Third World Network has called the WTO ‘one of the most non-transparent supra-national' bodies. But many people believe the World Trade Organization's principles should be supported and embraced. The WTO is a large step in the right direction to globalization. The long term benefits of free trade far outweigh only argument critics can come up with, which are short-term economic losses. The WTO is structured in a way that every member country is treated fairly and if not they can safely argue and settle disputes. The potential for new markets for all business world-wide are also great, and this in itself should be enough for any person to agree with its necessity.