I have this take home exam which counts for 50% of my final mark. I have to finish this tonight and have no clue where to begin. I could strangle this woman (my Indian lecturer) for setting such useless questions. Been doing lots of research and I can’t seem to get to the crux of the question.
The answer has to be 2500 words long. Question is:
“What are the major challenges confronting the WTO as an institution in achieving coherence in economic policies among trade, financial and developmental issues. Discuss in the light of WTO’s relationship with the IMF and World Bank.”
Any ideas as to how I should go about answering it?
Now I could easily write an essay on the WTO’s relationship with the WB and IMF and why there should be a convergence in their respective functions, but I have no idea what the challenges are in achieving these coherences, because from what I’ve seen they’ve been doing pretty well in coordinating their policies.
I think it's time you ask Hakeem Thapeen. He may not be able to provide you with an answer to WTO policies but he sure can prescrive some sort of jamaal gotta for your Indian teacher.
A far-reaching globalization of economic activity has resulted in an ever-growing interdependence among different areas of economic policy. Trade and financial policies and developments are increasingly interlinked within countries and in the way they affect other countries.
The goals of the three major international monetary bodies, the World Bank, IMF andWTO are interrelated. They all seek to achieve sustainable (global) economic growth. TheWorld Bank focuses on development, the IMF on stability and the WTO on free trade. All threeorganizations recognize the challenges that are presented to this mission by disparate wealthlevels between countries and environmental threats. Unfortunately, meeting these challenges istoo big of a job for these relatively small organizations to address alone.
The following document elaborate the challenges these three institutions are facing. The WTO, World Bank and IMF
Cat-woman, one of the kep problems with global organizations is the fact that there is no real global government hence each participant(country) in the organization has their own interests at hand and they will push that. So for example, opening up markets in developing countries often means that the country will end up with huge imports and large cash flow deficits with the importers countries.
Other issues are how do force countrys to implement the rules that are created by these organization.
In terms of the three organizations, each is focused on different aspects of the country and hence they have different ways of achieving them. Also since a country may be receptive to different things, they are liable to accept each organization differently. Hence it is very difficult for all three organization to come out with one consolidated way of helping a country. Also each organization on its own is very buearocratic and a power center and does not like to be controlled. Its somewhat similar to the army, navy and airforce of a country. You need a leader above all three in order to coordinate their actions, and in the case of these organization, only the UN can control all three but it prefers to mostly control indirectly and there are direct linkages between all three organizations that allow them to coordinate.
I'm not too familiar with the area, but in general if I were to write up this paper with the apriori knowledge, I would concentrate on
the fact that the three organizations need to consolidate their approach towards the development of countries by adopting policies that balance "trade" v.s. "aid".
There are various studies where authors argue whether aid flows or trade preferences are in the best interest of recipient country's welfare.
I personally maintain that the three organizations can help instigate programs between developing countries and industrial nations by instituting Donor support, moreover Donor Policy reforms to best align with the interests of developing countries. This is cuz donor resources transferred to the recipient via the donor’s own import liberalization is better for the recipient’s exports than a dollar transferred via grants.
You can further expand on this logic to find the best fit between partnering countries or developing those partnerships even further.
Dunno if this makes sense... its 1:00 at night, and I'm drained out !!!
Good Luck though :)
Cat-woman, what a great topic to write on! :) I did a paper very similar to this one recently in my MBA program but the issues were a bit more complex and involved private business enterprises. It took me 15 pages to answer the question posed for the paper I did.
Best of luck...I am sure you'll be able to come up with some interesting thoughts on the issue.
Thanks hmcq and Umar Talib, I have taken your notes and advice into consideration. Here is what I have mustered thus far - my intro. Sweetpie, I wish I had your enthusiasm :-)
Strengthening the coherence of international trade and financial policies is key to addressing problems of debt and development of developing and least-developed countries. There is an inextricable link between trade, debt and finance and thus cooperation between the WTO and the other Bretton Woods institutions (the IMF and World Bank) is essential for the enhancement of the multilateral trading system, which could be inadvertently affected by financial and monetary instability. One of the major challenges the WTO faces is the debt burden of developing countries, which stands in the way of an efficient global trading system, for without the resolution of debt burden and financial problems, a liberal international trade regime is impossible. The WTO cannot deal with these problems without coordinating its policies with the IMF and World Bank, and since the organizations have similar goals, cooperation between them is essential. In its preamble, the Doha Declaration states that the trade ministers have decided to “continue to work with the Bretton Woods institutions for greater coherence in global economic policy-making”. However, there are significant obstacles to achieving coherence especially where IMF, World Bank and WTO policies and practices are in conflict with each other. It is important to first consider the institutions’ respective functions before examining the links between trade, finance and development as well as the obstacles faced by the WTO in achieving economic coherence.
