The Role of WHO in the International Trade

0 Comment

This essay examines the background to trade growth in the past five decades, non-tariff barriers imposed by some countries, and the arguments against free trade. Finally, a few of the commonly used trade terms for the movement of goods and their significance for international trade are dealt with.According to WTO Report 2005, world trade in merchandise grew at an average of 7 percent per year between 1955 and 2004. This rate of growth is significant over the long period under consideration and reflects the overall strong growth of economies of the world despite periods of the slow down in some countries. Three important reasons for this impressive growth rate can be identified as (i) successive efforts among nations since 1947 to negotiate and put in place policies for non-restrictive trade, including tariff reductions (ii) significant growth of information and communication technologies and (iii) growing economies, populations and incomes in many of the developing countriesTrade is an important element of a nation’s economy and not surprisingly, the USA and the UK as the leading economies of the world at the end of World War II took the initiative in 1947 on removing restrictions for the free flow of goods (Six decades of world trade growth, WTR 2007, pp.180 – 187). While the US pushed for non-discrimination without exceptions, the UK with its historical background, argued for temporary barriers and preferential treatment of commonwealth nations. Beginning with this and successively moving to the formation of International Trade Organization (not ratified by the US) under UNESCO, and formation of General Agreement on Trade and Tariffs in 1947 (GATT) with the main objectives of removing trade restrictions, reducing tariffs, limiting quotas and dispute settlement process – all gave a fillip to international trade. Western European nations benefited with the increased access to the US market, while the latter exported more capital goods to the former.