What Is the Wto

Since 1945 trade policy has tended to be set within an international institutional framework. Until 1995 this was the General Agreement on Tariffs and Trade (GATT) and since then it has been the WTO.
The WTO depends on a rule based multilateral trade cooperation which does not focus on outcomes such as market share or growth, but simply attempts to establish the general conditions for competition facing exporters.
The larger the country, the larger its inter-regional trade and the smaller its international trade.
In many smaller countries (Canada and the Netherlands), international trade can represent a very large proportion of total GDP.
For LDCs economic development often involves the production and export of basic commodity items usually involving natural resources in a sequence beginning with the ones with the greatest comparative advantage.
LDCs place tariffs on finished goods in order to encourage the creation of a manufacturing sector.
As these countries become more integrated into world trading systems, growth increases and employment opportunities increase because of the gains from trade.
Both industrialized countries and NICs have done well out of GATT regulated trade. This has not been the case for LDCs which are very poor or for those which have specialized in primary products.
The WTO predicts that by 2005 there may be as many as 250 regional trading agreements covering more than 50% of trade. Such regional arrangements could damage the rules based multi-lateral trading arrangement fostered by WTO.
Trade in Services
Future growth in trade will be dominated by services.
At most, trade in goods will double over the next century.
Trade in services is already larger than trade in goods, and growth will be much faster.
In order for there to be free trade in services, each country must extend the principle of right of establishment and national treatment to the other country's firms that sell services.
Firms selling services in one country have...