Criticism of the World Trade Organization - Coursework Example

The World Trade Organization was created with the sole aim of harmonizing the trading environments globally so that there can be equity and access to available markets for products and services. This was based on the idea that equity in trade would provide an avenue for opportunities for smaller and weaker economies to grow and develop.  However, there are few indications to show that the WTO has lived to this objective.

Discussion

One of the behaviors of this global entity is that it fails to enact rules and regulations based on consensus. Most of the decisions made by the body are shrouded in secrecy and only a few nations participate. Most of the agenda in most WTO meetings is driven by the countries such as the United States of America, Japan, Canada, and European Union member countries. In most meetings, only select countries are invited which makes most of the decisions flawed and unilateral. Even where countries from such regions as Latin America and Africa are invited, they are never accorded an opportunity to air their grievances. Such ignorance makes the global body subjective since most of its decisions are skewed to favor European Union countries.

Most of this is evident in the policies that allow selective implementation of liberalization policies in the world. Most of the rich countries like the USA and European Union members have maintained high import tariffs and imposed quotas on goods that originate from poor economies like those in Africa. This has blocked exports from these poor countries from entering most of the western nations especially products like clothing and food products. At the same time, WTO pressurizes most of the poor countries to implement free-market policies and nontariff barriers across their borders. This is done intentionally so as to allow the European countries to dump their excess products into these poor economies thereby worsening an already bad situation (Bhagwati 2005). This is because such dumped products mainly include food products like milk and sugar that are locally produced in these poor economies. The WTO never reigns on these European countries as their behavior contributes immensely to the distortion of such markets in poor countries.

This WTO regulation provides ceilings on amounts that governments should provide as subsidies for their local farmers. However, there is no monitoring or any form of control by the WTO on European countries and other rich nations since they heavily subsidize their farmers far beyond any provided regulatory limits. This has a major impact on poor economies. This is because farmers in rich countries incur minimal costs of production due to these heavy subsidies they receive from their governments. On the contrary, farmers from poor countries are not subsidized by their governments since they have no resources. In case they do, the subsidies are often offered in form of repayable cheap loans mainly in form of farm inputs.

It, therefore, becomes obvious that products from the poor countries cannot compete with those from the rich countries due to failures of the WTO to regulate and offer oversight in the provision of subsidies by governments to their farmers (Steve 2007). This is in complete violation of the Agreement on Agriculture which clearly stipulates that the rich countries would reduce the amounts of trade-distorting subsidies and permit equitable penetration of their markets by-products from poor countries. The US and European Union have totally refused to remove or reduce such subsidies despite most of the poor countries like Africa having fully liberalized their economies. It also goes against the deliberations of the Uruguay Round and also the Doha negotiations where member countries of the WTO agreed that they would pursue policies that are friendly to develop countries. Instead, this has been interpreted by most European countries to mean exerting pressure on developing economies to open their agricultural, industrial, and other sectors while they are not opening theirs.