“If the Trade-Off Theory were true, then firms ought to have much higher debt levels than we observe in reality.” — Miller (in “Debt and Taxes” published in Journal of….
To What Extent Has the World Trade Organisation Helped?
The World Trade Organization (WTO) was established in 1995 after the Uruguayan Round. It embodies the international organization which deals with a wider range of aspects related to the international trade. The WTO controls the international trading system. It represents an evolved instrument of negotiation in comparison with the preceding General Agreements on Trade on Tariff and Trade (GATT). Hoekman, B. M. & Kostecki, M. M. (2009) WTO includes many important improvements on economic issues, disciplines and commitments of the international negotiation in addition it shape the current Multilateral Trading System (MTS).
United Nations Conference on Trade and Development (2008) Reports have shown that WTO was creating a favorable condition for business in Peru during the last 10 years. WTO (2007) since the beginning as member of WTO Peruvian governments have express their interest to continue doing necessary improvement in its legislation in order to achieve a completely integration to the global market as well as liberation of trade, WTO (2007) actively participation in negotiations and integration agreements is evidence of that.
For instance Peru has bilateral agreements in force with: Unites States of America, Chile, Mexico, Canada, Singapore, China, South Korea, Thailand, Japan, Panama, Andean community (CAN), Asia pacific Cooperation Forum (APEC) Latin America Integration association (LAIA), MERCOSUR, agreements signed with : Venezuela, Costa Rica, Guatemala, European Union, and Agreements in negotiation: El Salvador, Honduras, Doha program, Pacific alliance.
WTO. org (2012 Foreign capitals entering to the local market in Peru are steadily increasing as result of trade negotiations also it has made possible to some local industries access to the international market. However Peru still depends on commodities exportation, for example traditional products that are mainly agricultural and minerals such as Cooper, gold, oil and fish meal represent the 75. 7% and nontraditional products such as textiles and agro industrials products represents 23. 92 %. INEI (2012) in my view this may bring negative consequences to the local economy if Peru remain exporting non value added goods. Since 1995 Peru is a member of the WTO, WTO. org (2012). Agreements were incorporated to the Peruvian legislation 1996 however due to internal political troubles It was not possible to see the real impact of these agreements until 2002.
At that time deep concern in the government in turn made to undertake political reforms in order to promote a major participation of the country into the WTO. During the period from 2000 to 2002 Peru experienced grow of the domestic products (GDP) of 4. 6 %, a slightly increment from 2002 and 2006 of 5. 8 % however after coming into effect important bilateral and regional agreements the GDP grew 7. 8 % in 2010.
MICETUR (2012) WTO plays the role of international intermediary between developing and developed economies bringing apparently favorable condition to less developing world when facing negotiation for instance in the DOHA round of November of 2012 emerged the initiative to help developing countries by launching the Doha program which aim to find solutions to important issues affecting developing countries such as obstacle to access to international market of agricultural products, development of the agriculture industry by technical assistance, enhance the capacity, dispute settlement and industrial tariffs as well as services.
United Nations Conference on Trade and Development (2008) To conclude WTO propose the legal framework to create better conditions especially during commercial negotiations to achieve the development however Countries requires improve its capacities in order to be competitive and capable to avail this benefits.