The World Trade Organization

The World Trade Organization is an intergovernmental organization that exists to promote trade liberalization, facilitate and regulate multilateral trade agreements, and handle trade disputes between member countries.

Objectives and Functions (AO2)

• Set and enforce rules for international trade

• Facilitate and promote trade liberalization

• Resolve trade disputes

• Increase transparency of trade agreement decision-making 

• Cooperate with other international economic institutions

• Help developing countries benefit from global trading

Factors Affecting the Influence of the WTO (AO2)

• Difficulties of reaching agreement on services/primary products: Many countries enable protectionism in order to sustain a domestic industry in certain areas where it would be more economical to trade. Scandinavia, for example, places high tariffs on agricultural products from abroad while subsidizing its own farmers. This goes against the WTO's principles, but it is difficult for them to convince countries to give up their sovereignty. 

• Unequal bargaining power of members: Countries with the largest amount of consumers tend to have more bargaining power when it comes to bargaining. For example, Ecuador has a lot more to gain/lose when bargaining a trade deal with the US than vice versa, hence the US can be more demanding.