Advantages And Disadvantages Of Multilateral Trade Agreements

There is no doubt that increasing in international trade is supporting the economic growth across the world, raising incomes and creating jobs. However, international trade can also some create economic obstacles, such as the international context and the market policy and regulations of each country, and consequently it can be said that the effects would have positive and negative sides, and it is useful to mention all of them and to take them into consideration.

WTO: World Trade Organization deals with the global trading rules between international governments. The overall rules must be predictable enough so that everyone involved isn’t dealing with chaotic sudden changes.

Institutions encourage cooperation by creating interstate trade rules. Without a world government, states must self-enforce international agreements and punish others who violate them. Yet, states cannot enforce agreements or punish violators if they cannot agree on what constitutes a violation. Such ambiguity fosters conflict. Trade rules eliminate this ambiguity because they measure whether nations violated trade agreements. By identifying violations, trade rules thus prevent states from reciprocating punishment for misperceived transgressions (Frieden, Lake, and Schultz 2016). The World Trade Organization (WTO) provides such rules. Striving to promote market liberalization, the WTO requires members to implement non-discriminatory measures like Most-Favored Nation (MFN) and national treatment. MFN obliges members to give equal market access to all other members

Free trade agreements are in force all over the world today. A free trade agreement is an “agreement between two or more countries where the countries agree on certain obligations that affect trade in goods and services, and protections for investors and intellectual property rights, among other topics” (www.naftanow.org, 2013). These agreements are essential for the countries if they want to trade goods and services with each other without having to be bothered with each other’s laws and regulations.

The World Trade Organization (WTO) is a global agency that is dedicated to promoting free trade between member nations. It was founded on the idea that the world can be a better place if everyone works together. Before World War II, countries believed in protecting their domestic productions by implementing tariffs, or taxes against goods that are imported. Tariffs make imported goods cost more than domestic goods, thereby protecting the success of domestic producers. Today, most nations support free trade, which is the exchange of goods across borders without restrictions like quotas or tariffs. The elimination of tariffs is meant to allow trade between nations to occur more freely.

The World Trade Organization was developed in 1995 out of what was known as the Uruguay Round. Although GATT set rules they mostly dealt with issues just involving simple trade of goods and the distribution of tariffs. The WTO has a broader job than the GATT; “…it oversees multilateral agreements relating not just to good, but also to services, investment and intellectual property.” (Douglas Irwin, 186) The World Trade Organization is an independent organization and decisions are made out of consensus of the member countries involved, not from the World Trade Organization itself. When a country complains about another country and the way they run things that could affect their home country, the WTO must make a decision on what must be done. Once a ruling has been made the losing country must implement one of three strategies:

Foreign Direct Investment: Creation of trade blocs increase the foreign direct investment in the participating nations and benefit their economies. FDI brings in new technologies in the economy and lower the costs of manufacturing the products locally.

Since the mid-20th century, countries have progressively reduced barriers, subsidies to domestic industries and diverse restrictions on international commerce in order to promote specialization and greater efficiency in production. In theory, free trade allows nations to focus on their main comparative advantages and profit from cooperation and voluntary trade. This strategy is usually reinforced by treaties between two or more countries where commerce of goods and services can be handled across their common borders, without tariffs and other trade obstacles. As a key component of regional integration in the Americas, CAFTA-DR is one important example of this economic ideology.

- Trading blocks such as the North American Free Trade Agreement and the European Union stand to have a great impact on international business because they change the rules of trade and in some cases, investment, presenting new opportunities but also new threats to both foreign and domestic companies. Whether they are harmful or helpful is difficult to state in just a paragraph or two, but will depend on the

One of the biggest firms associated with globalization is the World Trade Organization. The World Trade Organization is the only international body that deals with the rules of trading between nations. It has evolved over the past half century into an entity that contract with the trade of services, intellectual property as well as its original intent of the trade of goods. The WTO controls most trade in the world today through over 100 countries, and even more on the way. The World Trade Organization is beneficial economically and we should support its principles.

The World Trade Organization (WTO) is a global organization that helps countries and producers of goods deal fairly and smoothly with conducting their business across international borders. It mainly does this through WTO agreements, which are negotiated and signed by a large majority of the trading nations in the world. The purpose of the WTO is to ensure that global trade commences freely, smoothly and predictably while also aiming to create economic peace and stability in the world through a multilateral system. This is based and applied to member states, currently 162 countries, that have consented and ratified the rules of the WTO in their individual countries. Simply put, these documents act as contracts that provide the legal framework for conducting business among nations, integrating into a country 's domestic legal system, therefore, applying to local companies and nationals in the conduct of business internationally. For instance, if a company were to open an office or business in a foreign country, the rules of the WTO dictates how that can be done.1

Throughout the years, there has been a constant controversy over whether the World Trade Organization should enforce global free trade. The primary idea is to establish in which all are happy. Although there are many advocates for trade liberalization, as well as many who oppose. I believe free trade may be advantageous for both large and small-industrialized countries, but it does not favor the smaller developing countries needs primarily.

Many economists today argue that the fewer tariffs and barriers there are to foreign trade, the better everyone fares. That view underlies the agreements that the United States and 152 other countries have made as members of the World Trade Organization (WTO). Among other

The numerous trade agreements developed between different groups of countries reveal the success of developing such relationships. Countries these trade agreements have reported increased imports and

     The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. The goal is to help producers of goods and services, exporters, and importers conduct their business. The World Trade Organization came into being in 1995. One of the youngest of the international organizations, the WTO is the successor to the General Agreement on Tariffs and Trade (GATT) established in the wake of the Second World War. The World Trade Organization exists to ensure that trade between nations flows as smoothly, predictably and freely as possible. It provides and regulates the legal issues which governs world trade now .