Essay on Impacts of WTO on Trading Countries

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Impacts of WTO on Trading Countries      International trading has had its delays and road blocks, which has created a number of problems for countries around the world. Countries, fighting with one another to get the better deal, create tariffs and taxes to maximize their profit. This fighting leads to bad relationships with competing countries, and the little producing countries get the short end of this stick. Regulations and organizations have been established to help everyone get the best deal, such as the World Trade Organization (WTO), but not everyone wants help, especially from an organization that seems to help only the big countries and those they want to trade with. This paper will be discussing…show more content…
There are five main rules that the WTO depends on to operate smoothly on a daily basis and they are as follows: nondiscrimination, reciprocity, enforceable commitments, transparency, and safety valves. (Paullier) First, we will look at nondiscrimination. There are two main concepts to understand when looking at the nondiscrimination rule: Most Favored Nation (MFN) and National Treatment Principle (NTP). The MFN involves one country, usually a larger, more developed country, deciding that it wants to trade with another country, usually a little country, and give them certain benefits that other countries might not get because the larger country doesn’t like them as well or had bad relationships with them. For example, if the Japan decided that it wanted to trade with Australia, and didn’t want as much from China, it could make exporting and importing more beneficial to Australia by overlooking tariffs and taxes it might impose on China. This would negate the US. National Treatment Principle, which can best be explained in terms of goods being treated equally, regardless of the origin of the product. For instance, if Texas wanted to sell its beef to Idaho and so did Australia; Idaho wouldn’t be able to impose a tax on the beef from Texas unless it imposed the same tax on the ones from Australia. This rule it supposed to keep trading fair between nations.      Second, reciprocity is an
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