The main function of the World Trade Organization, or WTO, is ensuring that international trade flows as smoothly as possible in the multilateral trading system between its 157 member countries. The WTO is the only international organization dealing with the global rules of trade between nations.Know More
Other interrelated functions of the WTO that operate in support of its main purpose include providing a forum for negotiations among countries and serving as a dispute settlement mechanism. When conflict arises between member nations, the countries bring their cases before the WTO, where virtually all decisions are made by consensus and are ratified by member nations' legislative or governing bodies. Settling conflicts through the WTO reduces the risk of disputes spilling over into political or military conflict.
Another main function of the WTO is the oversight of the development, implementation and administration of WTO agreements. The WTO oversees at least 60 agreements that have the status of international legal texts. These agreements, negotiated and signed by governments, are contracts that guarantee important trade rights to WTO member countries. The WTO agreements also bind governments to keep their trade policies within agreed limits.
The WTO officially was formed in 1995 under the Marrakesh Agreement. It grew out of the General Agreement on Tariffs and Trade, which was signed in 1947.Learn more about Economics
Trade is necessary to promote survival of a region and its people. Those involved in trade send goods that they have an abundance of to other regions in exchange for money or other goods that they do not have enough of.Full Answer >
Because different nations have different natural resources and human capabilities, trade has become a popular method of allowing nations to get the products people need, such as when the United States exports goods like wheat and corn to Japan and imports goods like computers and cars from Japan. In this example, Japan and the U.S. engage in trade in order to sell the surplus of the things they make and gain access to the things they don't make, allowing for a balance of a wide range of goods rather than a surplus of just a few things.Full Answer >
Trans-Saharan trade was the transit of goods between sub-Saharan Africa and the northern Arab and European worlds. Goods included precious metals, such as gold, as well as slaves. The trade route was in operation between the seventh and 14th centuries, expanding the more established trade route of the Silk Road between Europe and the Middle East.Full Answer >
Economists oppose trade restrictions because it creates inefficiency in the markets. It is best to have a global trade as opposed to a country closing itself from all kinds of foreign trade. Trade restrictions lock the country from new products, goods, skills available in other parts of the world.Full Answer >