Wto Principles
As it is known the WTO agreements is very huge in and documents full of complexity which cover range of activities such as banking, government procurement, agriculture, and etc. Therefore there are five clear principles that go into all documents, and they are considered as the basis of multilateral trading system (WTO, n.d.).
These principles are briefly introduced bellow:
Non-discrimination trading
The first principle to introduce is trading without discrimination, having two important components which are most-favoured-nation (MFN) and national treatment. Both are inserted as main rules in WTO on goods, intellectual property and services (Hoekman & Kostecki, 2009). However, the MFN rule can be briefly explained as a rule that makes a product made in a particular member country to be treated not less favourably (WTO, n.d.), or in simple language to be treated the same as a similar product that is made in another country. Although exceptions can be allowed, such as creating Free Trade Agreements such as the Gulf Cooperation Council (GCC), or developing countries may be given special access into their markets. But generally, if a country decided to the lowering of trade barrier or market opening, the same must happen to the same products from all members and partners no matter the circumstances (Hoekman & Kostecki, 2009).
The second component of non-discrimination trading principle is national treatment. After the foreigner goods enter a specific market, it has to be treated equally with local goods (WTO, n.d.). National treatment is applied on services, trademarks, patents and copyrights as well.
Freer Trade
The second principle of the trading system is freer trade. Encouraging trade makes trading much simpler to the members, by lowering trade barriers more members are encouraged. Customs duties, tariffs, import bans, or quotas are well known discouraging barriers. The treatments focused in decreasing custom duties or tariffs on imported goods. Regulations
These principles are briefly introduced bellow:
Non-discrimination trading
The first principle to introduce is trading without discrimination, having two important components which are most-favoured-nation (MFN) and national treatment. Both are inserted as main rules in WTO on goods, intellectual property and services (Hoekman & Kostecki, 2009). However, the MFN rule can be briefly explained as a rule that makes a product made in a particular member country to be treated not less favourably (WTO, n.d.), or in simple language to be treated the same as a similar product that is made in another country. Although exceptions can be allowed, such as creating Free Trade Agreements such as the Gulf Cooperation Council (GCC), or developing countries may be given special access into their markets. But generally, if a country decided to the lowering of trade barrier or market opening, the same must happen to the same products from all members and partners no matter the circumstances (Hoekman & Kostecki, 2009).
The second component of non-discrimination trading principle is national treatment. After the foreigner goods enter a specific market, it has to be treated equally with local goods (WTO, n.d.). National treatment is applied on services, trademarks, patents and copyrights as well.
Freer Trade
The second principle of the trading system is freer trade. Encouraging trade makes trading much simpler to the members, by lowering trade barriers more members are encouraged. Customs duties, tariffs, import bans, or quotas are well known discouraging barriers. The treatments focused in decreasing custom duties or tariffs on imported goods. Regulations
References: Hoekman, B.M. & Kostecki, M. M. (2009) The political economy of the world trading system The WTO and Beyond. 3rd ed. Oxford: Oxford University Press Pollock, R. (2003) Criticism of WTO Practices and Structures [Online] Available from: http://www.rufuspollock.org/wto/wto_crit_prac.htm (Accessed 26 September 2012) WTO (n.d.) Principles of the trading system [Online] Available from: http://www.wto.org/english/thewto_e/whatis_e/tif_e/fact2_e.htm (Accessed 25 September 2012)