Question

1. How do you think the World Trade Organization , International Monetary Fund and World bank influences importation in the free trade?

2. Would you agree that global economic integration is in evitable? Why?

Answer 1

Answer 1 - Role of World Trade Organization :

World Trade organisation plays a crucial role in alleviating trade barriers and deals with global rules of trade. Following points explains the role of WTO :

A) WTO ensures that trade between two countries flows smoothly and both countries got benefit from trade organisation.

B) Members of WTO cooperatively impose barriers and provide benefits to developing nations which need assistance.

C) WTO provides assistance and stability in trade. This is due to the fact that many countries take advantage of their specialisation and exploit other countries. WTO ensures removal of such acts.

D) It ensures concensus decisions so that no country is exploited.

Role of IMF in free trade :

IMF plays a crucial role in providing financial assistance to the underdeveloped and developing countries. Following points describes the role of IMF :

A) It promotes the stable system of exchange rates which indirectly contributes to free trade.

B) It prevents effective Balance of payment adjustment or to gain an unfair competitive advantage over the other members.

C)IMF also provides consultation for individual countries so that they can make strategies for free trade.

D) IMF coordinates with WTO for providing sanctions and subsidies on trade agreements

Role of World Bank in Free Trade :

World Bank also plays crucial role in providing free trade by providing financial assistance.

Following points explains about role of world Bank in free trade :

A) World Bank contributes in reduction of poverty through financial assistance which indirectly contributes to free trade.

B) It helps in arrangement of loans so that small and large projects needs can be met and free trade is possible.

C) It provides financial assistance on tecnological projects so that better technology products can be served worldwide.

D) Providing concessional or interest free loans to less developed countries so that they can meet their needs and also become able to serve worldwide.