GLOBALIZATION AND THE WORLD TRADE ORGANISATION A SURE HOPE FOR SUSTAINABLE DEVELOPMENT Abstract
This paper discuses Globalization of the international market and what roles the World Trade Organisation has played since its inception. It brings out the drivers of globalization and the impact of the WTO on Less-Developed states for example as well as the challenges. The need for International Bodies such as WTO has become necessary as the market becomes global so as to police the trade activities. 1.
The World Trade Organisation (WTO) was established in 1995 succeeding the GATT which was the only multilateral body governing international trade since 1948. The WTO is now the only international institution that deals with global rules of trade between nations. Its role is to ensure that trade and investment flows freely among its members. The WTO has about 153 members and Modern Zambia in Central Africa has been a committed member since 1st January 1995.Being a WTO member Zambia has welcomed international investors with investing opportunities in natural resource endowments, tourism with the majestic Victoria Falls, extensive nature and safari as well as agriculture potential. Zambia has made consistent growth in a tougher global environment despite the two decades of stagnation and heavy aid dependency. The mining, construction and service sectors have spurred the expansion of output growth at 5-6% per annum since 2000 showing a participation of regional economic revival. This report discusses International Business Globalization and the role of the World Trade Organisation co-ordination with other international bodies as a whole. It highlights the benefits for its members like Zambia and future plans of even empowering them more as far as international trade is concerned. 2.
According to Hill (2005) a fundamental shift is occurring in the world economy. We are moving away from a world in which natural economies are relatively self contained entities isolated from each other by barriers to cross border trade and investment; by distance, time zones and language and by national differences in govt regulation culture as well as business systems. This process is known as Globalization and Hill (2005) refers it to a shift toward a more integrated and interdependent world economy. Hence markets and businesses are able to trade across natural boundaries to become one huge global market place. Evidence of globalization is not hard to find, although the surprise may be that the current wave of globalization is not the first .In many ways, the world economy reached a peak of globalization just before the World War 1, when trade and foreign direct investment attained what were then unprecedented levels that are still quite remarkable when we look at the technology available at that time. The current wave of globalization however has far surpassed that of a century ago
Drivers of globalization
Both technological and governmental barriers contribute to the costs of interacting internationally .Falls in transport costs, decline in communication and information costs, as well as cuts in tariffs and non –tariff governmental barriers to trade in goods and services have combined to accelerate globalization to an unprecedented speed that show no sign of abating. Richardo’s theory of comparative advantage suggests that countries should specialize in the production of those goods that they produce most efficiently and buy goods that they produce less efficiently from other countries even if this means buying goods from other countries that they can even produce more efficiently.
The Role of International Bodies
With the increasing proportion of business as markets globalise it is evident that there is need for global institutions to manage and regulate as well as police the global market place. There has been a number of Global Institutions that has been created and to mention but a few...
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