The main criticisms of the WTO

The World Trade Organisation (WTO) is the world’s primary institution for all areas relating to trade, establishing default tariff rates for its members, setting out laws for fair and equal trade regulations, and acting as a forum for trade disputes and appeals to be carried out. The Organisation is member-driven and for agreements to be made there must be a consensus reached by its around-150 strong membership, representing well over 90% of the global economy.

Despite all members having equal voting powers, the economic influence exercised by the world’s wealthier states naturally provides them with an advantage. Critics of the WTO argue that it enables wealthier states/the ‘Global North’ to maintain tariffs and rules which provide them with an advantage at the expense of the developing world. Some of the poorest, most conflict-ridden and unstable countries in the world also not member to the WTO, such as Eritrea, North Korea and South Sudan, only worsening the problem.

The claim that the WTO favours the wealthier world is evidenced by the Doha Development Round, something which in itself has become the target of a lot of WTO-aimed criticism. The Doha Round is the currently ongoing round of negotiations in the WTO which is aimed at enabling developing countries to grow economically at a greater rate and with greater trade security. However, the round has been stalled by powerful, dynamic voting blocs (like the EU and the NAFTA countries) refusing efforts to abandon agricultural subsidisation, a policy which currently wreaks havoc on agricultural sectors across the developing world and which encourages agricultural dumping by developed states which significantly overproduce. Because of the WTO’s consensus voting system, progress over development has been painstakingly slow and issues such as agricultural subsidisation are effectively at a stalemate.

Finally, the WTO is also criticised for its pursuit of free trade at the expense of the developing world. The argument, often known as the infant industry argument, states that less- and non-competitive industries in developing countries require some tariff protections. The inability to set up targeted protectionist tariffs by poorer states also greatly inhibits the ability for diversification, with extractive economies largely in the Middle East and Africa limited even more to a sector with an ever-shortening lifespan. Emerging economies are also impacted as tariffs cannot be used to favour those domestic industries which have emerged, pitting local companies against transnational corporations on a level playing field.

Etien Jasonson


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.