Advantages Of Multilateral Trade

QUESTION1
MULTILATERAL APPROACH TO INTERNATIONAL TRADE AS ADVOCATED BY THE WTO
INTRODUCTION
A multilateral approach is a treaty that refers to trade between numerous countries. It was the main activity associated with the 1947 GATT which took place during international conferences, whereby legislators came together to reject out and reach agreement on numerous trade issues. In total, there were 8 conferences under the former GATT. The first 6 of these conferences, ending with the Kennedy Round in 1967, concentrated mainly on tariff allowances. These negotiations were very fruitful and led to a substantial reduction in typical world tariffs on manufactured goods (ITRISA, 2015:101).
According to Winham (1986:1) the Tokyo Round was negotiated

They also contended for special and differential treatment, both through the Generalized Systems of Preferences (GSP) and through the automaticity with which the balance of payment exclusion was used to authorize them to continue relying upon quantifiable boundaries and other protectionist measures.
 Not all developing countries nor manufactured goods are protected by the numerous preferences provisions. The Most Favored Nations (MFN) provides cuts that would shelter a wider variety of products and certainly would benefit some developing countries currently excluded from the GSP. The MFN tariff reductions also offer more advantageous access to world markets for unrestricted trade volumes (Baldwin & Murray,

China and South Africa), or one country and a trading bloc (e.g. the European Union and Morocco) or 2 trading blocs (e.g. EFTA and SCU).

ADVANTAGES OF REGIONAL AND BILATERAL APPROACH FOR BOTH POOR AND RICH COUNTRIES

 Most of developing countries are enjoying some sort of trade preferences in the form of very low or up to zero tariffs on their exports to developed countries.
 Bilateral trade deals tend to attract less attention, therefore pressure from the opposition forces is likely to be low.
 The GSP offers privileged entry or an extensive variety of products from 144 countries and regions into the Organization for Economic Co-operation and Development (OECD) markets.
 Bilateral trade agreements are easier to conclude than multilateral trade agreements.
 Members of the ACP (African, Caribbean, and Pacific) group of countries obtain superior admission to EU markets, and exports from the least developed countries (except for sugar, bananas and rice) are receiving almost duty- and quota-free entrance to the EU markets (IMF,