Major International Organizations Vasily Erokhin School of Economics and Management Harbin Engineering University
Contents: United Nations. World Bank Group. International Monetary Fund. World Trade Organization.
The United Nations
UN history: 1945
UN history: 2017
UN major areas Peace and security. Climate change. Sustainable development. Human rights. Disarmament. Terrorism. Humanitarian and health emergencies. Gender equality. Governance. Food production.
UN: International peace and security
UN: Human rights
UN: Aid
UN: Sustainable development
UN: International law
UN major bodies 1. 2. 3. 4. 5.
General Assembly. Security Council. Economic and Social Council. Secretariat. International Court of Justice.
General Assembly The chief deliberative, policymaking and representative organ of the United Nations. The forum for multilateral discussion of the full spectrum of international issues covered by the UN Charter. Standard-setting and codification of international law. Informal consultations on a wide range of substantive topics.
General Assembly powers Consider and approve the UN budget and establish the financial assessments of member states. Elect the non-permanent members of the Security Council and the members of other United Nations councils and organs and, on the recommendation of the Security Council, appoint the Secretary-General. Consider and make recommendations on the general principles of cooperation for maintaining international peace and security, including disarmament. Discuss any question relating to international peace and security and make recommendations on it. Discuss and make recommendations on any questions within the scope of the Charter or affecting the powers and functions of any organ of the United Nations. Initiate studies and make recommendations to promote international political cooperation. Make recommendations for the peaceful settlement of any situation that might impair friendly relations among countries.
17 Sustainable Development Goals
Committees of the General Assembly 1. 2. 3. 4. 5. 6.
Disarmament and international security. Economic and financial. Social, humanitarian and cultural. Special political and decolonization. Administrative and budgetary. Legal.
Security Council The Security Council has primary responsibility for the maintenance of international peace and security. The Security Council takes the lead in determining the existence of a threat to the peace or act of aggression. It can resort to imposing sanctions or authorize the use of force to maintain or restore international peace and security.
Security Council permanent members
Non-permanent members #
Country
End of term date
1.
Bolivia
2018
2.
Egypt
2017
3.
Ethiopia
2018
4.
Italy
2018
5.
Japan
2017
6.
Kazakhstan
2018
7.
Senegal
2017
8.
Sweden
2018
9.
Ukraine
2017
10.
Uruguay
2017
Security Council powers Maintain international peace and security. Investigate any dispute or situation which might lead to international friction. Recommend methods of adjusting such disputes or the terms of settlement. Formulate plans for the establishment of a system to regulate armaments. Determine the existence of a threat to the peace or act of aggression. Call on members to apply economic sanctions and other measures not involving the use of force to prevent or stop aggression. Take military action against an aggressor. Recommend the admission of new members. Exercise the trusteeship functions of the United Nations. Recommend to the General Assembly the appointment of the Secretary-General and, together with the Assembly, to elect the Judges of the International Court of Justice.
Economic and Social Council The principal body for coordination, policy review, policy dialogue and recommendations on economic, social and environmental issues, as well as implementation of internationally agreed development goals. Central platform for fostering debate and innovative thinking, forging consensus on ways forward, and coordinating efforts to achieve internationally agreed goals.
ECOSOC areas Promotion of sustainable development. Development of policy integration. Financing for sustainable development. Coordination of humanitarian actions. Guidance of operational activities for development. Ensurance of coordination and oversight. Building of partnerships. Increase of awareness on emerging issues. Work with civil society.
International Court of Justice The principal judicial organ of the United Nations. Its role is to settle, in accordance with international law, legal disputes submitted to it by states and to give advisory opinions on legal questions referred to it by authorized United Nations organs and specialized agencies.
Secretariat The Secretariat comprises the Secretary-General and international UN staff members who carry out the day-to-day work of the UN. The Secretary-General is chief administrative officer of the UN.
UN locations Headquarter: New York. Offices outside the main headquarter: Geneva, Vienna, and Nairobi.
Regional commissions: 1. 2. 3. 4. 5.
Economic and Social Commission for Asia and the Pacific (Bangkok). Economic and Social Commission for Western Asia (Beirut). Economic Commission for Africa (Addis Ababa). Economic Commission for Europe (Geneva). Economic Commission for Latin America and the Caribbean (Santiago).
UN specialized organizations #
Organization / agency
Acronym
1.
Food and Agriculture Organization
FAO
2.
International Atomic Energy Agency
IAEA
3.
International Labour Organization
ILO
4.
International Monetary Fund
IMF
5.
United Nations Educational, Scientific and Cultural Organization
UNESCO
6.
United National Industrial Development Organization
UNIDO
7.
World Tourism Organization
UNWTO
8.
World Bank Group
WBG
9.
World Health Organization
WHO
10.
World Intellectual Property Organization
WIPO
The World Bank Group
World Bank Group goals: To end extreme poverty globally within a generation (to decrease the percentage of people living with less than $1.90 a day to no more than 3% by 2030). To promote shared prosperity, a sustainable increase in the well-being of the poorer segments of society (to promote income growth of the bottom 40% of the population in each country).
WBG areas Human development. Agriculture and rural development. Environmental protection. Infrastructure. Large industrial construction projects. Governance.
Organizations within the WBG The World Bank
1. The International Bank for Reconstruction and Development.
2. The International Development Association. 3. The International Finance Corporation. 4. The Multilateral Investment Guarantee Agency.
5. The International Centre for Settlement of Investment Disputes
The International Bank for Reconstruction and Development
The international financial institution that offers loans to middle-income developing countries. It helps developing countries reduce poverty, promote economic growth, and build prosperity. IBRD is owned by the governments of its 189 member countries.
IBRD’s functions Supports long-term human and social development that private creditors do not finance. Preserves borrowers' financial strength by providing support in times of crisis. Promotes key policy and institutional reforms. Creates a favorable investment climate to catalyze the provision of private capital. Facilitates access to financial markets often at more favorable terms than members can achieve on their own.
IBRD’s services Provides innovative financial solutions, including financial products and knowledge and advisory services to governments at both the national and subnational levels. Helps countries build resilience to shocks by facilitating access to products that mitigate the negative impact of currency, interest rate, and commodity price volatility, natural disasters and extreme weather. Helps governments, official sector institutions, and development organizations build institutional capacity to protect and expand financial resources. Supports government efforts to improve the investment climate.
IBRD’s financing IBRD acquires funds primarily by borrowing on international capital markets by issuing bonds. IBRD offers flexible loans with maturities as long as 30 years and custom-tailored repayment scheduling. IBRD offers financing to subnational entities either with or without sovereign guarantees.
Deferred Drawdown Option – a line of credit for borrowers needing quick financing for an unexpected change. IBRD credit enhancement and guarantee products: policy-based guarantees, partial credit guarantees, partial risk guarantees.
IBRD’s commitments
Top 10 commitments to borrowing member countries in 2015-2016
IBRD’s business model
The International Development Association The international financial institution which offers concessional loans and grants to the world's poorest developing countries. The IDA lends to developing countries which suffer from the lowest gross national income, from troubled creditworthiness, or from the lowest per capita income. Overseen by 173 shareholder nations, IDA aims to reduce poverty by financing the programs that boost economic growth, reduce inequalities, and improve people’s living conditions.
IDA’s operations IDA is one of the largest sources of assistance for the world’s 77 poorest countries, 39 of which are in Africa, and is the single largest source of donor funds. IDA lends money on concessional terms. IDA provides significant levels of debt relief through the
Heavily Indebted Poor Countries Initiative (HIPC) and the Multilateral Debt Relief Initiative (MDRI).
IDA’s areas Primary education. Basic health services. Clean water and sanitation. Agriculture. Business climate improvements. Infrastructure. Institutional reforms
Allocation of IDA’s financial support in 2016
IDA17’s thematic areas 1. Climate change. 2. Fragile and conflict-affected countries. 3. Gender equality. 4. Inclusive growth.
IDA’s services Provides an efficient channel for directing development assistance to the poorest countries. IDA is a key partner during crises and emergencies through tools like its Crisis Response Window (CRW). Advises governments on ways to broaden the base of economic growth and protect the poor from economic shocks. Coordinates donor assistance to provide relief for poor countries that cannot manage their debt-service burden. Facilitates a system for allocating grants based on countries’ risk of debt distress, designed to help countries ensure debt sustainability.
Top-10 recipients of IDA’s financial support in 2016
The International Finance Corporation The international financial institution that offers investment, advisory, and asset management services to encourage private sector development in developing countries. Established in 1956 to advance economic development by investing in strictly for-profit and commercial projects that purport to reduce poverty and promote development.
IFC’s aims and goals Aim: to create opportunities for people to escape poverty and achieve better living standards by mobilizing financial resources for private enterprise, promoting accessible and competitive markets, supporting businesses and other private sector entities, creating jobs and delivering necessary services to those who are poverty-stricken or otherwise vulnerable.
Development goals: to increase sustainable agriculture opportunities, to improve health and education, to increase access to financing for microfinance and business clients, to advance infrastructure, to help small businesses grow revenues, to invest in climate health.
IFC’s services Investment services: loans, equity, trade finance, syndicated loans, structured and securitized finance, client risk management services, treasury services, liquidity management.
Advisory services: to support corporate decision making regarding business, environment, social impact, and sustainability; to prioritize the encouragement of reforms that improve the trade friendliness and ease of doing business.
IFC’s geography
The Multilateral Investment Guarantee Agency The international financial institution that offers political risk insurance and credit enhancement guarantees which help investors protect foreign direct investments against political and noncommercial risks in developing countries. Established in 1988 as an investment insurance facility to encourage confident investment in developing countries.
MIGA’s areas Countries eligible for assistance from the International Development Association. Fragile and conflict-affected environments. Transformational Projects – large scale and significant investments, with the potential for bringing about transformational change in the host country. Energy Efficiency and Climate Change – complex energy and infrastructure projects that improve energy capacity as well as transportation projects that have a positive impact on pollution control. Middle Income Countries where we can have strong impact.
MIGA’s types of risks Currency inconvertibility and transfer restriction. Government expropriation. War, terrorism, and civil disturbance. Breaches of contract. Non-honoring of financial obligations
The International Centre for Settlement of Investment Disputes The international arbitration institution established for legal dispute resolution and conciliation between international investors. The ICSID is an autonomous, multilateral specialized institution to encourage international flow of investment and mitigate non-commercial risks by a treaty drafted by the IBRD’s executive directors and signed by member countries.
ICSID membership
ICSID’s services Arbitrations under the ICSID Convention. Arbitrations under the Additional Facility. Conciliations under the ICSID Convention. Conciliations under the Additional Facility. Fact-Finding Proceedings. Non-ICSID investor-State Arbitrations. Non-ICSID State-State disputes. Mediations
Geographic distribution of new cases in 2016 under the 2016 convention, by countries involved
Geographic distribution of new cases in 2016 under the 2016 convention, by economic sector
International Monetary Fund The international organization to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.
IMF’s aims to promote international monetary cooperation; to facilitate the expansion and balanced growth of international trade; to promote exchange stability; to assist in the establishment of a multilateral system of payments; to make resources available to members experiencing balance of payments difficulties.
IMF’s milestones 1944: the IMF as a part of the Bretton Woods system exchange agreement.
Harry Dexter White: the IMF should function more like a bank, making sure that borrowing states could repay their debts on time.
John Maynard Keynes: the IMF should be a cooperative fund upon which member states could draw to maintain economic activity and employment through periodic crises.
IMF’s milestones 1945: 29 countries ratified IMF’s Articles of Agreement.
1946: The IMF had grown to 39 members. 1947: The IMF began its financial operation, with France being the first borrower
IMF’s milestones 1972-1981: The end of the Bretton Woods System. 1982-1989: Debt and painful reforms. 1990-2004: Societal Change for Eastern Europe and Asian Upheaval.
2005-present: Globalization and the Crisis.
IMF’s mission to ensure the stability of the international monetary system in three ways:
1. Surveillance. 2. Lending. 3. Capacity development.
Surveillance The IMF oversees the international monetary system and monitors the economic and financial policies of its member countries. The IMF highlights possible risks to stability and advises on needed policy adjustments. The IMF helps the international monetary system serve its essential purpose of sustaining economic growth by facilitating the exchange of goods, services, and capital among countries, and ensuring the conditions necessary for financial and economic stability.
Surveillance Bilateral surveillance – continuous monitoring of members’ economies, appraisal of and advice on the policies of each member country.
Multilateral surveillance – monitoring of global and regional economic trends, and analysis of spillovers from members’ policies onto the global economy. World Economic Outlook (WEO). Global Financial Stability Report (GFSR). Fiscal Monitor. Regional Economic Outlook reports. Pilot External Sector Reports. Global Policy Agenda
Lending A core responsibility of the IMF is to provide loans to member countries experiencing actual or potential balance of payments problems. This financial assistance helps countries in their efforts to: rebuild their international reserves, stabilize their currencies, continue paying for imports, restore conditions for strong economic growth, undertake policies to correct underlying problems.
Loan instruments Non-concessional loans: Stand-By Arrangements. Flexible Credit Line. Precautionary and Liquidity Line. Extended Fund Facility. Rapid Financing Instrument.
Concessional loans: Extended Credit Facility. Standby Credit Facility. Rapid Credit Facility.
Stand-By Arrangements The SBA is designed to help countries address shortterm balance of payments problems. Program targets are designed to address these problems and disbursements are made conditional on achieving these targets.
Precautionary basis – countries choose not to draw upon approved amounts but retain the option to do so if conditions deteriorate.
Flexible Credit Line The FCL is for countries with very strong fundamentals, policies, and track records of policy implementation. Access is determined on a case-by-case basis, is not subject to access limits, and is available in a single up-front disbursement rather than phased. Disbursements under the FCL are not conditional on implementation of specific policy understandings. FCL-qualifying countries have a demonstrated track record of implementing appropriate macroeconomic policies.
Precautionary and Liquidity Line The PLL is for countries with sound fundamentals and policies, and a track record of implementing such policies. PLL-qualifying countries may face moderate vulnerabilities and may not meet the FCL qualification standards, but they do not require the substantial policy adjustments. The PLL combines qualification with focused conditions that aim at addressing the identified remaining vulnerabilities. There is flexibility to either draw on the credit line or treat it as precautionary.
Extended Fund Facility Extended Fund Facility helps countries address mediumand longer-term balance of payments problems reflecting extensive distortions that require fundamental economic reforms. Its use has increased substantially in the recent crisis period, reflecting the structural nature of some members’ balance of payments problems. Arrangements under the EFF are typically longer than SBAs – normally not exceeding three years at approval.
Rapid Financing Instrument The RFI was introduced to replace and broaden the scope of the earlier emergency assistance policies. The RFI provides rapid financial assistance with limited conditionality to all members facing an urgent balance of payments need.
Concessional lending The Fund’s concessional facilities for Low Income Countries is a part of broader efforts to make the Fund’s financial support more flexible and better tailored to the diverse needs of LICs. The norms and limits for concessional facilities were expanded in 2015 to maintain their levels relative to increasing production, trade, and capital flows. All facilities support country-owned programs aimed at achieving a sustainable macroeconomic position consistent with strong and durable poverty reduction and growth.
Extended Credit Facility The Extended Credit Facility is the IMF’s main tool for medium-term support to low income countries facing protracted balance of payments problems. Financing under the ECF currently carries a zero interest rate, a grace period of 5½ years, and a final maturity of 10 years.
Standby Credit Facility The Standby Credit Facility provides financial assistance to low income countries with short-term or potential balance of payments needs. Financing under the SCF currently carries a zero interest rate, with a grace period of 4 years, and a final maturity of 8 years.
Rapid Credit Facility The Rapid Credit Facility provides rapid financial assistance with limited conditionality to low income countries facing an urgent balance of payments need. Financing under the RCF currently carries a zero interest rate, has a grace period of 5½ years, and a final maturity of 10 years.
Capacity development Capacity development – technical assistance which helps countries develop more effective institutions, legal frameworks, and policies to promote economic stability and inclusive growth.
Management: headquarters; regional technical assistance centers; regional training centers; regional training programs; trust funds; bilateral donor-supported activities.
Importance of capacity development Building human and institutional capacity within a country helps the government implement more effective policies, leading to better economic outcomes. Technical assistance provided to emerging and advanced economies in select cutting-edge areas helps increase the impact of IMF policy advice, keeps the institution up-to-date on innovations and risks to the global economy, and help address crisis-related challenges. Specialized technical assistance and training from the IMF help build both institutional and human capacity in countries for effective policymaking. Achieving greater integration among technical assistance, training, surveillance, and lending operations is a key priority for the IMF.
Voting power in the IMF: top-ten [ИМЯ [ИМЯ [ИМЯ КАТЕГОРИИ]; КАТЕГОРИИ]; КАТЕГОРИИ]; 2.63% 2.25% 2.67% [ИМЯ КАТЕГОРИИ]; 3.06%
[ИМЯ КАТЕГОРИИ]; 16.73%
[ИМЯ КАТЕГОРИИ]; 4.09% [ИМЯ КАТЕГОРИИ]; 4.09% [ИМЯ КАТЕГОРИИ]; 5.39%
[ИМЯ КАТЕГОРИИ]; 6.16%
[ИМЯ КАТЕГОРИИ]; 6.23%
Criticism Developed countries have a more dominant role and control over less developed countries. Incorrect assumption that all payments disequilibria were caused domestically. Some IMF policies may be anti-developmental. Out of touch with local economic conditions, cultures, and environments in the countries IMF requires policy reform. Environmental issues.
World Trade Organization The intergovernmental organization which deals with regulation of trade between participating countries by providing a framework for negotiating trade agreements and a dispute resolution process aimed at enforcing participants' adherence to WTO agreements.
Members of the WTO
WTO’s aims Liberalization of international trade. Maintenance of the validity and predictability of international trade. Provision of the economic growth and increase of the economic wealth of the people.
WTO’s functions to oversee the implementation, administration and operation of the covered agreements; to provide a forum for negotiations and for settling disputes; to review and propagate the national trade policies; to ensure the coherence and transparency of trade policies through surveillance in global economic policymaking; to assist developing, least-developed and low-income countries in transition to adjust to WTO rules and disciplines through technical cooperation and training.
WTO’s fundamental principles 1. Non-discrimination. 2. Freer trade. 3. Predictable and transparent. 4. More competitive. 5. More beneficial for less developed countries. 6. Protect the environment.
Principle 1: Non-discrimination Non-discrimination means that a country should not discriminate between its trading partners and between its own and foreign products, services or nationals.
Most-favoured-nation: treating other people equally. Countries cannot normally discriminate between their trading partners. Every time a country opens up a market, it has to do so for the same goods or services from all its trading partners.
National treatment: treating foreigners and locals equally. Imported and locally-produced goods should be treated equally — at least after the foreign goods have entered the market.
Principle 2: Freer trade Freer trade means lowering trade barriers to encourage trade. Trade barriers include customs duties (or tariffs) and measures such as import bans or quotas that restrict quantities selectively. By the 1980s, the negotiations had expanded to cover non-tariff barriers on goods. WTO allows countries to introduce changes gradually, through “progressive liberalization”.
Principle 3: Predictability and transparency Foreign companies, investors and governments should be confident that trade barriers should not be raised arbitrarily. Another way is to discourage the use of quotas and other measures used to set limits on quantities of imports.
Transparency: many WTO agreements require governments to disclose their policies and practices publicly within the country or by notifying the WTO.
Percentage of tariffs bound before and after the 1986-1994 talks Countries
Before
After
Developed countries
78
99
Developing countries
21
73
Transition economies
73
98
Principle 4: More competitive More competitive means discouraging ‘unfair’ practices, such as export subsidies and dumping products at below cost to gain market share. WTO allows tariffs and other forms of protection, but its system of rules is dedicated to open, fair and undistorted competition.
Principle 5: More beneficial for less developed countries Giving developing countries longer transition periods to adjust, greater flexibility and special privileges. Developed countries should accelerate implementing market access commitments on goods exported by the least-developed countries.
Principle 6: Protect the environment The WTO permit members to take measures to protect not only the environment but also public health, animal health and plant health. Members must not use environmental protection measures as a means of disguising protectionist policies.
WTO structure
WTO’s agreements spell out the principles of liberalization, and the permitted exceptions; include individual countries’ commitments to lower customs tariffs and other trade barriers, and to open and keep open services markets; set procedures for settling disputes; prescribe special treatment for developing countries; require governments to make their trade policies transparent.
WTO’s agreements
General Agreement on Tariffs and Trade GATT is a multilateral agreement regulating international trade with a purpose of substantial reduction of tariffs and other trade barriers and the elimination of preferences, on a reciprocal and mutually advantageous basis.
General Agreement on Trade in Services GATS is a multilateral agreement regulating international trade in services with a purpose to remove barriers to trade.
Modes of supply of services: 1. services supplied from the territory of one party to the territory of another; 2. services supplied in the territory of one party to the consumers of any other; 3. services provided through the presence of service providing entities of one party in the territory of any other; 4. services provided by nationals of one party in the territory of any other.
Agreement on Trade-Related Aspects of Intellectual Property Rights TRIPS is the international agreement that sets down minimum standards for many forms of intellectual property regulation as applied to nationals of other WTO members.
TRIPS areas: 1. applicability of basic GATT principles and those of relevant international intellectual property agreements; 2. provision of adequate intellectual property rights; 3. provision of effective enforcement measures for those rights; 4. multilateral dispute settlement; 5. transitional arrangements.
Dispute settlement Dispute Settlement Understanding – enforces the rules and therefore ensures that trade flows smoothly. Judgements by specially-appointed independent experts are based on interpretations of the agreements and individual countries’ commitments. WTO encourages countries to settle their differences through consultation.
Trade Policy Review Mechanism TPRM’s purpose is to improve transparency, to create a greater understanding of the policies that countries are adopting, and to assess their impact. All WTO members must undergo periodic scrutiny, each review containing reports by the country concerned and the WTO Secretariat.
Advantage 1: The system helps to keep the peace Sales people are usually reluctant to fight their customers. Peace is partly an outcome of two principles of the trading system: helping trade to flow smoothly, and providing countries with a constructive and fair outlet for dealing with disputes over trade issues. The WTO system is an important confidence-builder.
Advantage 2: The system allows disputes to be handled constructively Countries in dispute always aim to conform with the agreements. As trade expands in volume, in the number of products traded, and in the numbers of countries and companies trading, there is a greater chance that disputes will arise. The WTO system helps resolve these disputes peacefully and constructively
Advantage 3: A system based on rules rather than power makes life easier for all Smaller countries enjoy more bargaining power, and life is simpler for bigger countries. The WTO cannot claim to make all countries equal. But it does reduce some inequalities, giving smaller countries more voice.
Advantage 4: Freer trade cuts the cost of living Protectionism is expensive: it raises prices The WTO’s global system lowers trade barriers through negotiation and applies the principle of non-discrimination. The result is reduced costs of production and reduced prices of finished goods and services, and ultimately a lower cost of living.
Advantage 5: WTO gives consumers more choice Imports allow us more choice – both more goods and services to choose from, and a wider range of qualities. Quality of locally-produced goods can improve because of the competition from imports. Success of an imported product or service on the domestic market can encourage new local producers to compete, increasing the choice of brands available to consumers as well as increasing the range of goods and services produced locally.
Advantage 6: Trade raises incomes The fact that there is additional income means that resources are available for governments to redistribute. Lowering trade barriers allows trade to increase, which adds to incomes — national incomes and personal incomes. Resources are available for governments to redistribute the benefits from those who gain the most.
Advantage 7: Trade stimulates employment
Careful policy-making harnesses the job-creation powers of freer trade. Trade clearly has the potential to create jobs. In practice there is often factual evidence that lower trade barriers have been good for employment.
Advantage 8: The basic principles make the system economically more efficient WTO helps to increase efficiency and to cut costs because of important principles enshrined in the system WTO principles (non-discrimination, transparency, increased certainty about trading conditions, simplification and standardization of customs procedure) make trading simpler, cutting companies’ costs and increasing confidence in the future.
Advantage 9: The system shields governments from narrow interests Governments are better placed to ward off powerful lobbies. The GATT-WTO system helps governments take a more balanced view of trade policy. Governments are better-placed to defend themselves against lobbying from narrow interest groups by focusing on trade-offs that are made in the interests of everyone in the economy.
Advantage 10: The system encourages good government The rules reduce opportunities for corruption. The WTO rules discourage a range of certain policies. For business that means greater certainty and clarity about trading conditions. For governments it can often mean good discipline.
Critics against the WTO 1: The WTO dictates policy The WTO is member-driven. The rules of the WTO system are agreements resulting from negotiations among member governments. The rules are ratified by members’ parliaments. Decisions taken in the WTO are virtually all made by consensus among all members.
Critics against the WTO 2: WTO is for free trade at any cost It all depends on what countries want to bargain One of the principles of the WTO system is for countries to lower their trade barriers. Just how low those barriers should go is something member countries bargain with each other.
Critics against the WTO 3: Commercial interests take priority over development Sustainable development is a principal objective Freer trade boosts economic growth and supports development. Whether or not developing countries gain enough from the system that does not mean the system offers nothing for these countries
Critics against the WTO 4: Commercial interests take priority over the environment Environmental objectives are recognized in the WTO agreements Marrakesh Agreement includes optimal use of the world’s resources, sustainable development and environmental protection. Specific agreements on specific subjects also take environmental concerns into account. Subsidies are permitted for environmental protection.
Critics against the WTO 5: Commercial interests take priority over health and safety Safety concerns are built into the WTO agreements Key clauses in the agreements specifically allow governments to take actions to protect human, animal or plant life or health. The WTO does not set the standards itself
Critics against the WTO 6: The WTO destroys jobs, worsens poverty Producers and workers who were previously protected face new competition when trade barriers are lowered Freer-flowing and more stable trade has the potential to create jobs and it can help to reduce poverty. The biggest beneficiary is the importing country that lowers its own trade barriers. Workers in export sectors enjoy higher pay and greater job security.
Critics against the WTO 7: Small countries are powerless in the WTO Everyone has to follow the same rules Developing countries have become considerably more active in WTO negotiations. The present rules are the result of multilateral negotiations. Without the WTO, smaller countries would have been powerless to act against their more powerful trading partners
Critics against the WTO 8: The WTO is the tool of powerless lobbies
Governments can use the WTO to resist lobbying The outcome of every WTO trade round has to be a balance of interests. The private sector and lobbying groups do not participate in WTO. They can only exert their influence on WTO decisions through their governments.
Critics against the WTO 9: Weaker countries are forced to join the WTO
Countries willingly want to join Most countries do feel that it’s better to be in the WTO system than to be outside it. By joining the WTO, even a small country automatically enjoys the benefits that all WTO members grant to each other.
Critics against the WTO 10: The WTO is undemocratic Decisions are by consensus. Agreements are ratified in parliaments In principle, that is even more democratic than majority rule because no decision is taken until everyone agrees. Consensus means every country accepts the decision.
Thank you for your attention! Vasily Erokhin School of Economics and Management Harbin Engineering University Email:
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