Developing Countries: A Case Study

Developing countries are distinguished by low gross domestic product per capita and usually exporting primary products such as agriculture and labor intensive industries such as textiles (Carbaugh, 2008). They constitute around two thirds of WTO and they are becoming more important in shaping the global economy (Martin, 2001) .According to Carbaugh, some developing countries claimed that they are facing the following problem and they used them to justify their protection trading policies :
Unstable export market as their primary product tend to fall in low price elasticity of the demand and the supply. This cause the volatility in the prices of these products (Carbaugh, 2008).
Worsen trade problem as ratio of exports prices to the imports

Regional agreement can help the participating member to reform their trade policies in situation when the reform is difficult at global level. The benefits for the member from these agreements depend on distinctivity of their comparative advantages among the participants (Martin, 2001).
Initially, the developing countries had not involved deeply in the multilateral agreements till the inception of WTO in Uruguay Round. In Uruguay Round two major changes in negotiations . The first change was to increase the coverage of countries and products including exports of developing countries. The second change is to consider the capabilities of countries instead of imposing rules on the countries. After Uruguay Round, the developing countries seized reduction in tariff and other trade barriers. This direction of removing high tariff and other trade barrier was beneficial for the developing countries. For example, the cost of tariff for developing countries for the of 1995 was estimated $43 billion (Martin, 2001). In spite of huge gain for developing countries from adopting the liberalization and WTO agreements, developing countries has faced challenges in implementing WTO agreements. These challenges includes the