Failure of WTO's Anti-Dumping Policies

Examine one notable
success or failure of the
WTO and consider how
and why the WTO met or
failed to meet its stated
aims.
Management
5/6/2019
xxxx
xxx

Introduction
The World Trade Organization (WTO) is an organization formed for the purpose of developing
rules of global trade, for trade organizations to negotiate terms and conditions and for resolving
of disputes amongst the member countries. It began its operations in 1995 but had already been a
part of the world trading system since 1948 as the General Agreement on Tariff and Trade
(GATT). The GATT has gone through several round of negotiations but the Uruguay Round
(from 1986 to 1994) led to the formation of the WTO. It is said that the World Trade
Organization was born out of negotiations and for the purpose of carrying out negotiations
resulting in further negotiations. It is set of rules and conditions formed for the purpose of
liberalizing trade and for removal of global business barriers to trade1. The WTO is made up of a
number of agreements and these agreements form a part of its trade rules. These rules cover
everything which falls into the purview of trade - from goods and services to intellectual
property. These rules of trade are accepted by the member countries of WTO and therefore,
converted into agreements which are accepted by all.
The World Trade Organization is a multi-lateral trade system and has the membership of about
163 countries and 23 observer governments (as of 2019). These countries have accepted the
membership of the WTO because of the fact that its dispute settlement mechanism is its central
focus. It helps to clearly define rules and policies which makes the global trading system more
secure and transparent. According to the preamble held by the World Trade Organization, the
purpose of the formation of this organization is not to pass judgement – just to settle any and all
disputes as and when they arise2. The disputes in the WTO are due to promises broken by the
member countries. Any promise made to settle any trade agreement in a certain manner, if not
fulfilled in the desired manner, leads to a dispute. The settlement of this dispute is the priority of
the World Trade Organization3.
The question which has been existing since the inception of GATT, now WTO, is whether it is a
success or a failure. The WTO has had mixed reactions from its member nations and from the
1 ‘What is the World Trade Organization’ (World Trade Organization)
https://www.wto.org/english/thewto_e/ whatis_e/tif_e/fact1_e.htm. Accessed 5 May 2019.
2UNDERSTANDING THE WTO: SETTLING DISPUTES‘(World Trade Organization)
https://www.wto.org/english/thewto_e/whatis_e/tif_e/disp1_e.htm. Accessed 5 May 2019.
3 Phil Levy, ‘What's Wrong With The World Trade Organization?’ (Forbes, 30 October 2018).
https://www.forbes .com/sites/phillevy/2018/10/30/whats-wrong-with-the-world-trade-
organization/#6c9398923a49. Accessed 5 May 2019.

observers. According to many, it has proven to be a success whereas according to some, it has
been a failure and not done what it was originally formed to do. Those in support of the World
Trade Organization point out the fact that global trade wars which were earlier a predominant
part of the trade world, have ceased to exist4. Trade has been carried out more peacefully ever
since the inception of the WTO. Earlier there were high trade barriers to global business – now
those barriers (especially trade tariffs) have been lifted or reduced. Also, many have pointed out
that apart from this organization there is no other option available to the member countries. The
WTO is one of its kind5. Also, it has proven to be a boon for the developing nations.It has
broadened the scope of global trade much more than was thought possible.
However, the failures of the WTO have outweighed its successes. The organization has
deemed to be a failure as it has not done what it was formed to do. The organization, at best, can
be called vague and ambiguous. It usually plays a passive role. The failures of the WTO are
being discussed below:
 The democratic nature of the WTO is under question due to the fact that it is dominated
by a few large and powerful nations. All member countries do not have equal say in
formation of global trade rules.
 The WTO has defended its Trade Related Intellectual Property Rights (TRIPs). These
intellectual property rights include trademarks, patents, copyrights, etc. and have been
unduly protected at the cost of the health of human beings6.
 Free trade, as promised by the WTO, has proven to be a theoretical concept only. It has
not managed to remove all trade barriers and free trade for developing countries is still a
distant dream.
 The Anti-Dumping Agreement and the Agreement on Subsidies and Countervailing
Measures of the WTO has so far not yielded the desired results. The dumping laws to
protect the domestic markets of smaller countries is vague and not actually active in its
part.
4 Ralph Ossa, ‘Is the WTO a failure or a success?’ (Chicago Booth Review, 1 December 2015)
Accessed 5 May 2019.
5 ‘World Trade Organization: Success or Failure’ (MSG – Management Study Guide)
https://www.managementstudyguide.com/world-trade-organization-success-or-failure.htm.
Accessed 5 May 2019.
6 Vinati, ‘World Trade Organization: Successes and Failures’ (2016) 4 (2) International
Refereed Journal of Reviews and Research http://irjrr.com/irjrr/March2016/111.pdf. Accessed
5 May 2019.