Identify the main issues in the new multilateral agenda and explain Essay

Identify the main issues in the new multilateral agenda and explain how the interests of developed countries differ from those o - Essay Example Multilateral trade entails agreements among several nations on the quantity, price and tariffs of the trade (Keet, 2000). Multilateralism enables nations to solve complex global problems especially on issues that entail the use of force. Barfield (2001) is of the opinion that multilateral rules should promote greater transparency and consistency through minimising the distortions caused by the discriminatory practices of some nations. The agreements should also provide legal security in dispute resolution and increase equity in market access among the member nations. The agreements should also consider the interests of the developing countries such as the need of harmonized trading systems that eliminate a lot of bureaucracies (Kulovesi, 2011). The World Trade Organisation (WTO) was created in January 1995 can be termed as the biggest reform in multilateral trade since the end of the 2nd World War. General Agreement on Tariffs and Trade (GATT) was established in 1947 and arranged 8 w orld rounds. At the Tokyo round, 102 GATT participating countries resolved to cut custom duties by a third in the major industrial markets thus bring the custom duties to about 4.7 percent compared with a high of 40 percent at the inception of GATT in 1947 (Schott, 2000). However, the recessions of early 1980s forced many countries in North America and Europe to start bilateral agreements with competitors and enhance the subsidies in order to remain competitive. WTO was founded on the principles of non-discrimination of the foreign and local companies, transparency in trade negotiations, reciprocity in concessions and differential treatment since developing countries could require favourable treatment and positive discrimination (Blackhurst 1998). There are numerous reasons why WTO was created to replace GATT. GATT only covered trade on merchandised goods unlike WTO that includes trade in intellectual property and services (Barfield, 2001). GATT only entailed set rules and instructi ons that had no institutional foundation unlike, WTO which is a permanent institution with a fully recognised secretariat. The member countries wanted a new multilateral trade system with faster dispute resolution unlike old GATT system (Blackhurst 1998). The GATT agreements and provisions were subject to the discretion and willingness of the member countries in the implementation thus many countries declined in implementing certain provisions for own reasons, unlike the WTO guidelines that are compulsory and permanent. Agricultural products, textiles and services were exempt from GATT regulations and some member countries administered anti-dumping duties and voluntary export restrains that led to trade distortions (Keet, 2000). There are numerous challenges facing the WTO such as the labour standards. Labour organisations have asserted that WTO guidelines permit the exploitation of labour and ultimate destruction of the environment. According to Mitchell (2005), the WTO standards u ndermine the country regulations that are designed to conserve the environment and ensure the health and safety of its citizens. The major controversy is whether WTO is the right institution to enforce the global labour standards especially in developing countries whose economic production is labour-intensive. Although WTO indicated that it would work with the International Labour Organisation (ILO) since 1996, it seems to