World Trade Organization

The World Trade Organization is a union that is often very misunderstood but not without reason, in order to fully understand this international organization one must look into the motives for its inception. The seeds of the World Trade Organization were planted initially as an international trade agreement known as the General Agreement on Tariffs and Trade (GATT); an agreement on the reduction of trade barriers of manufactured goods. The GATT was established in 1947 to reduce trade barriers trying to establish a ‘free trade’ global economy. The GATT had proven successful after member nations had reduced their tariffs by a factor of ten; from approximately 50% to 5%. Since its beginnings, the GATT had evolved from an accord to an organization which far supersedes its initial priority, now even comprising a trade dispute resolution system. …show more content…
Now it is very unrealistic to expect the world economy to operate on a ‘perfect competition’ model, but it is important to try and reduce barriers, so firms may operate anywhere in a fair manner and consumers then may have more options and ultimately lower prices. Holding countries accountable for unfair trade practices is essential to have a fair playing field for trading nations. There are definitely a lot of benefits with such an organization; an example being stated living standards have tripled after the establishment of the World Trade Organization, as stated by British Political Economist Phillipe LeGrain. Additional benefits to World Trade Organization include the difficulties of lobbying, legitimacy to economic sanctions, and its use as a trade war prevention