Question

1. What are the primary principles on which the WTO operates? Why are these important for maintaining open trade among member countries?

Answer 1

The WTO (World Trade Organisation) makes some rules and policies for trading. It doesn't define or guarantee the outcome of its policies.

So generally , WTO operates on some basic principles which can be understood as follows-

1. Non Discrimination - It consist of generally two major factors which are - most favoured nation (MFN) rule and national treatment policy. Both are main WTO rule on goods and services but somehow these are different from each other in scope and nature . The MFN rule says that the member of WTO must apply the same condition on the trade with other WTO members. Whereas, National treatment means that imported good should be treated no less favouribly than domestically produced good.

2. - Reciprocity- . It shows both a desire to limit the scope of free-riding that may arise because of the MFN rule, and a desire to obtain better access to foreign markets. A connected point is that for a nation to negotiate, it is necessary that the gain from doing so be greater than the gain available from doing all the necessary activities.

3 - Transparency - The WTO needs to make all the needy things transpent which are necessary to be shown to the outsiders. The member of the WTO needs to publish their trade regulations, policies .

Safety Values-. Sometimes governments have to restrict trade. The WTO's agreements permit members to take measures to protect not only the environment but also public health, animal health and plant health.

Principles are the basics guidelines on which any organisation runs if these are not followed by the outsiders or the member of WTO itself than there will be no value of the organisation will be remaining in the society or it will loose all the interest in the public , so the principles are very important for maintaining open trade among member countries.