WTO is an international organization to handle world trade. Currently, there is a stall in the world trade due to the US-China war and move specifically of the withdrawal of developing nations tag from India and China by the USA. This is due to
The USA alleges
- India and China
- Misusing developing nation tag
- Themselves opaque about subsidy, government enterprise etc.
Resulting in
- Going against A.23 of Dispute Settlement Understanding of WTO (prohibition of the unilateral embargo)
- Relegating WTO’s position.
- Disrupting world order might give to rise to jungle rain in world trade order.
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In order to evaluate the situation, one must analyze WTO’s utilities. They are:-
WHO –
- Emerges helped in trade growth – stability – improving world economy after World War II.
- Caused Massive Structural Change.
E.g.: 1995 – 0.8% Internet Users
2019 – 57% Internet Users
- Promoted International Trade
E.g.: Single iPhone – 14 components
- 7/8 Multinational Company
- 40 countries
- Lowered Import tariff by 15%
- Implemented Free Trade Agreements.
- Functioned – Forum for dispute settlement
E.g.: Avoided Trade war worth $340 billion.
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Yet sure is some short timing in WTO’s functioning. They are:
- The multilateral process not fortified
- Negotiation
- 164 members
- Complex
- Rise of Regionalism
- Suffers from Evolutionary bias
Yes, I think WTO shall average as a lynchpin of global trade governance. The following steps shall assist this emergence.
- The assistance of the USA – through a reasonable later.
- Reasonable Multilateralism – Open discussion – hearing all members.
- Alternative entering into plurilateral agreements.
- Big players should share the burden rather than being altruistic.
The world order is a must for global peace and to tackle an omniscient recession crisis. Rise of WTO shall be an important defence in such a crisis