Unit 13 - Essays - Trade Flashcards
(4 cards)
Assess the success of the World Trade Organization (WTO) in promoting free trade and solving trade disputes.
Paragraph 1: Promotion of free and fair trade
WTO reduces tariffs and trade barriers (e.g. GATS)
Benefits to export-led economies like Germany and South Korea
Limited benefit for LICs without protections
Paragraph 2: Dispute resolution effectiveness
Airbus vs Boeing: Long-running but balanced outcome
Indonesia vs Australia: Helped MICs challenge unfair bans
System is expensive and complex—used more by HICs/MICs than LICs
Paragraph 3: Support for LICs
Bangladesh: Duty-free access boosted garment exports (84% of exports)
Rwanda: WTO technical support reduced customs delays from 11 to 3 days
Still criticised for favouring industrialised economies
Paragraph 4: Failures and bias
Doha Round failed due to HIC/MIC dominance
Agricultural subsidy disputes unresolved (e.g. EU CAP)
LICs lack negotiation power and remain disadvantaged
Paragraph 5: Institutional limitations
Collapse of dispute appeals (US blocking judges)
Rise of regional trade blocs weakens WTO
WTO rulings sometimes ignored (e.g. US steel tariffs)
Conclusion:
The WTO has had partial success in promoting rules-based trade and dispute settlement, particularly for HICs and some MICs, but remains slow, biased, and limited in enforcing rulings or helping LICs.
‘All global trade should follow the principles of Fairtrade.’ How far do you agree with this statement?
Paragraph 1: Benefits to producers in LICs
Minimum prices protect against market volatility (e.g. cocoa in Ghana)
Premiums fund healthcare, education (e.g. Peru)
Paragraph 2: Promoting empowerment and sustainability
Better working conditions and gender equality (e.g. Cameroon)
Supports eco-friendly farming (e.g. organic coffee in Mexico)
Paragraph 3: Practical limitations
Limited market access: most certified products sold at world prices
Only a small percentage benefits from Fairtrade price premiums
Paragraph 4: Unequal benefits
HIC retailers and brands take large share of Fairtrade profits
Fairtrade doesn’t address wider trade inequality (e.g. subsidies, tariffs)
Paragraph 5: Costs and exclusion
High certification costs exclude poorer farmers (e.g. Kenya)
Better-resourced cooperatives benefit more, causing uneven outcomes
Conclusion:
While Fairtrade principles offer clear benefits to some producers, it is unrealistic to apply them universally due to structural trade inequalities, limited demand, and high compliance costs. A hybrid approach may be more viable.
Assess the extent to which global patterns of trade are influenced by changes in the global market.
Paragraph 1: Shifting consumer demand and tech
Rise of e-commerce, green technologies; decline in coal
MICs like China and India adapted rapidly to new demand patterns
Paragraph 2: Geopolitical changes
US–China trade war and Russia’s shift post-2014 sanctions
LICs suffer more from exclusion or instability
Paragraph 3: Global shocks (pandemics, crises)
COVID-19 disrupted trade routes, exposed import reliance
LICs struggled to import essentials (e.g. vaccines, food)
Paragraph 4: Rise of new trading blocs and agreements
RCEP, USMCA, EU reshape trade flows
HICs/MICs benefit more from negotiation power
Paragraph 5: Long-term structural patterns still matter
Colonial ties still shape trade (e.g. UK ↔ Kenya)
Resource endowment and location continue to influence trade
Conclusion:
Global market changes increasingly shape trade patterns, particularly through technology and geopolitics, but historical and structural factors still underpin long-term trade directions.
‘Historical factors are of limited importance in explaining global patterns of trade.’ How far do you agree?
Paragraph 1: Importance of colonial ties
Examples: France ↔ West Africa; UK ↔ India
Shared language, infrastructure, and legal systems boost trade links
Paragraph 2: Reduced importance over time
India diversified trade towards USA and China
Caribbean still reliant on UK/EU
Paragraph 3: Modern factors are more dominant
Trade agreements (e.g. EU, RCEP) drive most flows today
Digital trade and manufacturing hubs more influential than history
Paragraph 4: Geographic and economic factors
Locational advantage (e.g. Singapore, Mexico)
Resource endowment drives trade focus (e.g. Chile, Saudi Arabia)
Paragraph 5: Trade shaped by changing demand and tech
E-commerce, green energy shift patterns faster than history can predict
MICs like Vietnam gain prominence despite no colonial ties
Conclusion:
While historical factors explain some persistent trade relationships, they are increasingly overtaken by modern influences such as trade agreements, technological change, and economic development.
