Weakness of Wto

Strengths and Weaknesses of the Present Trade System
for Developing Countries

Çaglar Özden

Dept of Economics
Emory University
Atlanta, GA 30322

&

Development Research Group, Trade
World Bank
Washington, DC 20433

March 2003

Introduction

It is commonly accepted that “increased trade is essential” for developing countries to fully benefit from increased globalization of product and financial markets (United Nations [2001]). Despite the importance of successfully integrating developing countries into the world economy, there has always been an active debate on the pace, method and institutional framework to achieve these goals. An important milestone in the debate was reached when a large number of developing countries actively participated in the Uruguay Round negotiations and signed the agreements. Since then, many other countries joined the WTO, agreed to implement many reforms and committed to make the rule-based multilateral trade regime a cornerstone of their development process.

This commitment is stated clearly in the opening sentences of the Doha Ministerial Declaration: “The multilateral trading system embodied in the WTO has contributed significantly to economic growth, development and employment throughout the past fifty years. We are determined, in the light of the global economic slowdown, to maintain the process of reform and liberalization of trade policies, thus ensuring the system plays its full part in promoting recovery, growth and development.” (WTO [2001]). However, the Doha Declarations could not conceal the complaints among the developing countries that the promises of the Uruguay Round were not fulfilled.   The events and discussions surrounding and following the Seattle and Doha Ministerial Conferences are illustrations of this dissatisfaction[1].

The Doha Ministerial Declaration repeatedly stresses the commitment to WTO   “as the unique forum for global trade rule-making and liberalization.” For the global commitment to economic...