Critically Evaluate the Role of Gatt/Wto in Trade Liberalisation
10 common misunderstandings about the WTO
Is it a dictatorial tool of the rich and powerful? Does it destroy jobs? Does it ignore the concerns of health, the environment and development? Emphatically no. Criticisms of the WTO are often based on fundamental misunderstandings of the way the WTO works.
The debate will probably never end. People have different views of the pros and cons of the WTO’s “multilateral” trading system. Indeed, one of the most important reasons for having the system is to serve as a forum for countries to thrash out their differences on trade issues. Individuals can participate, not directly, but through their governments.
However, it is important for the debate to be based on a proper understanding of how the system works. This booklet attempts to clear up 10 common misunderstandings.
The 10 misunderstandings 1. The WTO dictates policy 2. The WTO is for free trade at any cost 3. Commercial interests take priority over development … 4. … and over the environment 5. … and over health and safety 6. The WTO destroys jobs, worsens poverty 7. Small countries are powerless in the WTO 8. The WTO is the tool of powerful lobbies 9. Weaker countries are forced to join the WTO 10. The WTO is undemocratic
1
1. organization. That means:
The WTO does NOT tell governments what to do
The WTO does not tell governments how to conduct their trade policies. Rather, it’s a “member-driven”
• the rules are ratified by members’ parliaments, and • decisions taken in the WTO are virtually all made by consensus among all members.
adopting the findings of a panel of experts or an appeal report. Even then, the scope of the ruling is narrow: it is simply a judgement or interpretation of whether a government has broken one of the WTO’s agreements—agreements that the infringing government had itself accepted. If a government has broken a commitment it has to conform. In all other respects, the WTO does not dictate to governments to adopt or
Is it a dictatorial tool of the rich and powerful? Does it destroy jobs? Does it ignore the concerns of health, the environment and development? Emphatically no. Criticisms of the WTO are often based on fundamental misunderstandings of the way the WTO works.
The debate will probably never end. People have different views of the pros and cons of the WTO’s “multilateral” trading system. Indeed, one of the most important reasons for having the system is to serve as a forum for countries to thrash out their differences on trade issues. Individuals can participate, not directly, but through their governments.
However, it is important for the debate to be based on a proper understanding of how the system works. This booklet attempts to clear up 10 common misunderstandings.
The 10 misunderstandings 1. The WTO dictates policy 2. The WTO is for free trade at any cost 3. Commercial interests take priority over development … 4. … and over the environment 5. … and over health and safety 6. The WTO destroys jobs, worsens poverty 7. Small countries are powerless in the WTO 8. The WTO is the tool of powerful lobbies 9. Weaker countries are forced to join the WTO 10. The WTO is undemocratic
1
1. organization. That means:
The WTO does NOT tell governments what to do
The WTO does not tell governments how to conduct their trade policies. Rather, it’s a “member-driven”
• the rules are ratified by members’ parliaments, and • decisions taken in the WTO are virtually all made by consensus among all members.
adopting the findings of a panel of experts or an appeal report. Even then, the scope of the ruling is narrow: it is simply a judgement or interpretation of whether a government has broken one of the WTO’s agreements—agreements that the infringing government had itself accepted. If a government has broken a commitment it has to conform. In all other respects, the WTO does not dictate to governments to adopt or