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We can observe easily that cooperation under anarchy is difficult because all countries fight for their own benefit, and they are worried about other countries gaining more. In fierce competition among countries, sometimes a country will set trade restriction on another to implement trade protection towards itself, which will slow down the development of international trade. The WTO (WORLD TRADE ORGANIZATION) was aimed at cutting off tariffs in order to reduce the costs of carrying out trade activities within the region. Because of WTO, trade policies among countries would be based on win-win situation. Through the platform that WTO provides, each country competes equally; international trade has been developing with less trade restriction and protectionism.
The WTO helps in economic reforms and encourages economic development among member states. This will significantly help the development of an anarchical state with poor coordination and having trade issues. The WTO is obligated to promote economic development through implementation of regulations and policies that help in promoting trade activities within the organization’s members. For instance, there has been the introduction and implementation of trade liberalization programs among the organization’s members. The organization has, actively, been involved in implementing various strategies that encourage trade activities among its members. In a recent negotiation, developed countries have allowed quota free and duty-free imports from developing countries.
Trade barrier like tariffs and dumping could be the reason why international trade develops slowly. Tariff is one kind of tax imposed on the imported goods. If one country imposes high tariff on some particular goods, the residents of the importing country will spend more money to purchase the goods. When some states join WTO, they probably set some trading agreement to reduce tariffs and to boost the economy. Dumping is one of the most seriously problems in international trade, and it damages the domestic economy of the importing country. The anti-dumping policy in WTO has a great effect on international trade. Through the negotiations among member countries, reallocating resources became more efficient. WTO also regulate in what time and situation a country can use safeguards to protect its domestic economy.
The WTO has a myriad of goals and objectives that are aimed at facilitating trade activities among nations around the world. The organization can help an anarchical state to improve its trading activities through the intervention and employment of various strategies to promote trade. The organization is responsible for the implementation, administration and operation of the agreed terms and condition that exist between trading nations. The WTO body is obligated to resolve trade conflict can seek WTO intervention a resolution that will resolve the matter in contention. The WTO can also help a government find better ways and strategies of implementing the regulations that relate to trade activities in order to promote trade.
The WTO ensures trade activities are carried out without discrimination. For example,