WTO Objectives Overview
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Questions and Answers

What is the main purpose of the WTO's Most Favoured Nation principle?

  • To prioritize national security over international agreements
  • To allow preferential trade among selected countries
  • To guarantee equal trade benefits to all member nations (correct)
  • To impose tariffs on all member countries

    • Which of the following is NOT a goal of the WTO?

  • Promote regional trade agreements
  • Manage barriers to trade
  • Increase tariffs on imports (correct)
  • Facilitate international investment

    • What is one of the exceptions to the Most Favoured Nation principle?

  • Support for multinational corporations
  • Elimination of all tariffs
  • Trade only within the European Union
  • Promotion of infant industries (correct)

    • How does the WTO address issues of dumping?

    <p>By encouraging retaliation from affected nations (D)</p> Signup and view all the answers

    What role does the WTO play in preventing balance of payment problems?

    <p>It encourages balanced trade practices among members (D)</p> Signup and view all the answers

    What is a primary aim of the WTO regarding trade policies?

    <p>Facilitate international trade in goods and services (B)</p> Signup and view all the answers

    Which of the following is considered an exception to the Most Favoured Nation principle?

    <p>Granting preferential treatment to developing nations (D)</p> Signup and view all the answers

    How does the WTO respond to concerns regarding infant industries in newly industrializing countries?

    <p>Allows temporary protection measures (B)</p> Signup and view all the answers

    Flashcards

    Most Favoured Nation (MFN) Principle

    All WTO members treat each other equally, applying the same tariffs and trade rules to imports from all members.

    MFN Exceptions

    WTO rules allow countries to make exceptions to the MFN principle in specific cases.

    Retaliation against Dumping

    WTO allows countries to impose tariffs on imports if they're being sold below their cost of production (dumping) and harming domestic industries.

    Protecting Infant Industries

    Newly industrializing countries can use temporary protection to shield developing industries from international competition.

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    Industries of Strategic Importance

    WTO allows countries to restrict trade if it's essential for national security, such as defense or essential resources.

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    WTO's Main Goal

    The WTO aims to reduce tariffs and trade barriers, making it easier for goods, services, investments, and intellectual property to move freely between countries.

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    MFN Principle

    The WTO's 'Most Favoured Nation' principle requires members to treat each other equally in trade, applying the same tariffs and rules to all.

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    Exceptions to MFN

    The WTO allows for exceptions to the MFN principle in some situations, like when protecting national security or supporting infant industries.

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    WTO's Response to 'Dumping'

    If a country sells goods below their production cost (dumping) and harms domestic industries, the WTO allows for retaliatory measures, like tariffs.

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    Study Notes

    WTO Objectives

    • Reduce tariffs and barriers to trade in goods, services, investments, and intellectual property (IP). This includes managing and facilitating these domains.
    • Implement the Most Favoured Nation (MFN) principle, ensuring non-discrimination among member countries.
    • Allow exceptions to the MFN principle under specific circumstances.
    • Permit retaliation for dumping practices.
    • Provide support for infant industries, particularly in newly industrialising countries.
    • Protect industries crucial for national security.
    • Prevent excessive imports and balance-of-payments issues.
    • Allow for regional trade agreements.

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    Description

    Explore the key objectives of the World Trade Organization (WTO) in this quiz. Learn about tariffs, the Most Favoured Nation principle, and the support provided for developing countries. Test your knowledge on international trade policies and their implications.

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