Self-Enforcing Trade

Self-Enforcing Trade: Developing Countries and WTO Dispute Settlement

Copyright Date: 2009
Pages: 282
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  • Book Info
    Self-Enforcing Trade
    Book Description:

    The World Trade Organization -backbone of today's international commercial relations -requires member countries toself-enforceexporters' access to foreign markets. Its dispute settlement system is the crown jewel of the international trading system, but its benefits still fall disproportionately to wealthy nations. Could the system be doing more on behalf of developing countries? InSelf-Enforcing Trade, Chad P. Bown explains why the answer is an emphatic "yes."

    Bown argues that as poor countries look to the benefits promised by globalization as part of their overall development strategy, they increasingly require access to the WTO dispute settlement process to protect their trading interests. Unfortunately, the practical realities of WTO dispute settlement as it currently stands create a number of hurdles that prevent developing countries from enjoying the trading system's full benefits. This book confronts these challenges.

    Self-Enforcing Tradeexamines the WTO's "extended litigation process," highlighting the tangle of international economics, law, and politics that participants must master. He identifies the costs that prevent developing countries from disentangling the self-enforcement process and fully using the WTO system as part of their growth strategies. Bown assesses recent efforts to help developing countries overcome those costs, including the role of the Advisory Centre on WTO Law and development focused NGOs. Bown's proposed Institute for Assessing WTO Commitments tackles the largest remaining obstacle currently limiting developing country engagement in the WTO's selfenforcement process -a problematic lack of information, monitoring, and surveillance.

    eISBN: 978-0-8157-0418-8
    Subjects: Political Science

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-x)
  3. Acknowledgments
    (pp. xi-xvi)
  4. Introduction
    (pp. 1-9)

    International trade disputes between countries are an inevitable feature of economic relations in an interdependent world. Historical examples of commercial policy clashes leading to famous trade wars include the Anglo-Hanse disputes from the fourteenth to seventeenth centuries, the Anglo-French trade wars of the seventeenth to nineteenth centuries, the numerous intra-European tariff wars of the nineteenth century, as well as the Anglo-Dutch rivalry for the East India trade in the seventeenth century.¹ Prominent twentieth century episodes include the international response to the U.S. Smoot-Hawley tariffs during the Great Depression, the U.S.–European Economic Community (EEC) “chicken wars” in the 1960s, and...

  5. 1 The WTO and GATT: A Principled History
    (pp. 10-21)

    While the World Trade Organization in current existence provides its membership with forums for three interrelated functions—negotiation, illumination, and litigation—it is probably best known for the first of these. This chapter provides a brief overview of the negotiating forum of the General Agreement on Tariffs and Trade and its WTO successor, as well as how each has been used by the world’s major trading nations since 1947.

    Since the ultimate focus of this book is on developing countries and dispute settlement, it may appear strange to start with a topic that has little obvious relation to either. This...

  6. 2 Developing Countries, the WTO Agreements, and Trade Liberalization
    (pp. 22-44)

    Despite the apparent successes that the General Agreement on Tariffs and Trade and the World Trade Organization have contributed to post—World War II international economic cooperation, many critics have charged that the current bargain found in the agreements is unfriendly to developing countries. They wonder, given that developing countries are advised to engage in more trade to help them grow, exactly what does the WTO have to offer? Indeed, a newcomer looking at the WTO agreements for the first time may conclude that some elements of the World Trade Organization are hostile to the interests of developing countries. Put...

  7. 3 An Introduction to WTO Dispute Settlement
    (pp. 45-62)

    The last chapter described the set of World Trade Organization agreements resulting from rounds of multilateral negotiations over forty-seven years. The next step is to begin to explore the implications for developing countries of the WTO as aself-enforcingtrade agreement. For the agreement to work, trading partners must find it in their own interest to remain a part of the agreement and to hold one another accountable to bargains made if one country steps away from it. Throughout most of the General Agreement on Tariffs and Trade and WTO history and for most of the commitments made, member countries...

  8. 4 Developing Countries and WTO Trade Disputes
    (pp. 63-98)

    Now that the events surrounding theEC—Bananas IIIdispute have portrayed how the World Trade Organization dispute settlement process can work, I turn to the full WTO caseload of data. The description of this one particular dispute in chapter 3 and the earlier discussion of the WTO agreements and historical negotiations in chapters 1 and 2 raise a number of theoretical questions that I explore in the data. After examining the raw data, I discuss the results of empirical scholarship examining how WTO members, and particularly developing countries, use self-enforcement to ensure access to foreign markets in practice.


  9. 5 WTO Enforcement at the Firm Level: The Extended Litigation Process
    (pp. 99-137)

    The eminent legal scholar Robert Hudec has rightly suggested that dispute settlement under the current World Trade Organization system is now one of “jurist’s jurisprudence” when compared with the General Agreement on Tariffs and Trade system’s “diplomat’s jurisprudence.”¹ Nevertheless, a literal interpretation of this statement may take matters too far. Evidence shows that countries that use the WTO dispute settlement process effectively to enforce market access are forced to rely on much more than skillful lawyers. Mastery of WTO law in dispute settlement is a necessary but not sufficient condition for enforcement of market access.

    Although the discussion in the...

  10. 6 The Advisory Centre on WTO Law
    (pp. 138-174)

    The last chapter highlighted examples of teams of government lawyers at the Office of the United States Trade Representative (USTR), the European Community’s Directorate General for Trade (DG Trade), and other World Trade Organization members’ trade offices that litigate dispute settlement cases by working in public-private partnerships with firms and industries to enforce their access to foreign markets. In other instances, private law firms with large numbers of lawyers in their international trade practice groups sometimes take the lead litigating WTO disputes on behalf of their commercial and government clients. Interestingly enough, one of the busiest groups of lawyers involved...

  11. 7 Development-Focused NGOs in WTO Enforcement
    (pp. 175-207)

    Introducing the role of nongovernmental organizations (NGOs) in the World Trade Organization system immediately brings to mind the fiery street protests and anti-globalization activists at the failed Seattle ministerial meetings in December 1999. Although the media coverage from Seattle was a public relations fiasco for the WTO, the spotlight transformed the institution from a virtual unknown entity into a familiar, if not necessarily welcome, presence on the world scene.¹ Moreover, the role of nongovernmental organizations—including many “civil society” groups, which focus on the needs of developing countries—has subsequently evolved so that some now attempt to make substantive contributions...

  12. 8 Monitoring and the Institute for Assessing WTO Commitments
    (pp. 208-237)

    Despite the efforts of a number of stakeholders—including policymakers, the Advisory Centre on WTO Law (ACWL), and even a number of development-focused nongovernmental organizations (NGOs)—to encourage the developing countries’ self-enforcement efforts, a substantial hurdle continues to impede the access of exporting firms and their governments to the system. Developing country firms and their government representatives often lack information on the underlying cause of their industry’s lost foreign market access. Since failure to recognize the cause leads to failure to recognize that the country’s World Trade Organization (WTO) rights have been violated, the affected firm cannot even overcome the...

  13. 9 Conclusions
    (pp. 238-246)

    The consensus among many analysts of and participants in the current international trading system appears to be that there are two distinct World Trade Organizations—one for rich economies and one for poor economies. I have attempted to make sense of this distinction and to argue how developing countries might enjoy further benefits from the system by enhancing their ability to self-enforce their trading interests.

    For the developed economies, there is increasing evidence that the WTO is a well-designed institution. The history of the General Agreement on Tariffs and Trade and the WTO has resulted in a system that has...

  14. Appendix
    (pp. 247-260)
  15. References
    (pp. 261-272)
  16. Index
    (pp. 273-282)
  17. Back Matter
    (pp. 283-284)