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Greetings Delegates!
We feel privileged and honored to welcome you all to the committee of the World Trade
Organization at Sreenidhi MUN 2014. We are looking forward to working with you all and
ensuring a constructive debate. We hope that this simulation proves fruitful to you and you
take something valuable back from it. This MUN aims at giving you a better and thorough
insight upon the working and functioning of The UN and its sub-committees. We also hope
that by the end of the MUN you will have a better understanding about the MUN procedures,
rules and objectives and that you will be willing to participate in more such MUNs.

We have designed a Background Guide for you to start off your research process. The
Background Guide is a major resource for you but should not provide a hindrance in your
external research. The Background Guide will help you get familiar with the agenda and its
background but for the committee to progress as a delegate you must carry forward external
research. This is the advice the EB would like to give you. The Background Guide will
provide you with the guiding questions for your external research and background research
on your country.

We urge all members of the committee to take the time to read the background guide
and use it as a starting point for their research. We urge every delegate to come to the
conference with an open mind, ready to meet and work with new people, and actively
participate in the debate in the committee, debate and argue solutions and problems and help
form a thorough and effective resolution.
As the delegates of the Committee you all will decide the direction in which the committee
goes. So the EB of WTO urges you to help initiate a healthy debate with a clear direction.
As your executive board, we want active participation from all the delegates, and we shall be
more than happy to clear all your doubts and queries. So you can approach us any time during
the MUN and help us in making it an amazing experience for you. The EB looks forward to
your presence at Sreenidhi MUN. Happy MUNning and Researching!
- Mir Hashim Khan
- Vaishnavi Maganti
- Vamsi Masireddy













History of the Committee

The General Agreement on Tariffs and Trade (GATT) arose in 1947 out of the ashes of the
Second World War, as did the International Monetary Fund and what we now know as the
World Bank. It was the product of unprecedented international cooperation by an international
community that was deeply scarred by the damage and destruction that endless warfare had brought
about; an international community searching for an entirely new beginning and a new international
order. While GATT certainly ushered in a new era of international cooperation, it nonetheless had to
weather the effort to create an International Trade Organization that catered to more than just the
superficial demands that the growing global trade scenarios put forth; that restricted common mans
understanding of trade to merely exchange of goods and commodities. Trade began to encompass the
cross-border movement not just of goods but of services, capital, ideas and even people. The
expansion in what we understand trade policy to be all about was the principal reason for the
transition from GATT to the WTO, as the earlier arrangement which was more a contract than an
institution was considered to be too weak a vessel to contain the new issues, pressures of numerous
other national and regional conflicts, and the entire Cold War, before eventually morphing into the
WTO (World Trade Organization).
The organization officially commenced on 1 January 1995 under the Marrakech Agreement, The
organization deals with regulation of trade between participating countries by providing a framework
for negotiating and formalizing trade agreements and a dispute resolution process aimed at enforcing
participant's adherence to WTO agreements, which are signed by representatives of member
governments

and ratified by their parliaments. Most of the issues that the WTO focuses on derive
from previous trade negotiations, especially from the Uruguay Round (19861994). Additionally, it is
the WTO's duty to review and propagate the national trade policies, and to ensure the coherence and
transparency of trade policies through surveillance in global economic policy-making.

There is no doubt either that several new challenges lie at the doorstep of the multilateral trading
system, whether they are part of WTO agreements or entirely new issues. In parallel, many members
continue to liberalize their trade unilaterally or through preferential trade agreements between pairs or
groups of countries, which move the bar higher.
History shows that this is not new. The WTO is very much a response to a similar set of challenges
with which the international community was confronted more than 20 years ago.

Mission and Mandate
More specifically, the WTO's main activities are: Negotiating the reduction or elimination of
obstacles to trade (import tariffs, other barriers to trade) and agreeing on rules governing the
conduct of international trade (e.g. antidumping, subsidies, product standards, etc.).

Administering and monitoring the application of the WTO's agreed rules for trade in
goods, trade in services, and trade-related intellectual property rights.

Monitoring and reviewing the trade policies of our members, as well as ensuring
transparency of regional and bilateral trade agreements.

Settling disputes among our members regarding the interpretation and application of
the agreements.

Building capacity of developing country government officials in international trade
matters.



Assisting the process of accession of some 30 countries who are not yet members of
the organization.

Conducting economic research and collecting and disseminating trade data in support
of the WTO's other main activities.

Explaining to and educating the public about the WTO, its mission and its activities.

The WTO's founding and guiding principles remain the pursuit of open borders, the
guarantee of most-favored-nation principle and non-discriminatory treatment by and among
members, and a commitment to transparency in the conduct of its activities.


What is meant by free and fair trade?
What are trade imbalances?

Throughout history, trade has been the biggest and most flexible gateway to the successful
growth of the global society and economy. Trade has ensured diversity in products, spread of
technological information, growth In all the rural and urban industries, international co-
operative relations, growth in GDP, GNP, National income and an overall smooth flow of
goods, services, resources and MONEY across the global economy. Such progressions have a
positive Domino effect. But to what extent does trade maintain its positive direction?

While the economy might seem like its running very smoothly at the upper levels, the hidden
lower levels are facing problems. Levels indicate the different tiers in which the trade flow is
divided into. The lower levels are where trade fails to have a big positive effect due to cheap
prices. At the lower levels, where the farmers, small business owners and manufacturers exist
is where trade is achieved at the cheapest bid. This is where the profits run low and the sellers
are cheated of their money.

Now the agenda of this committee has two different trade related words in it. Fair Trade and
Free Trade. Although these might sound very similar they are not. Heres why and how-

FREE TRADE- Free trade proponents believe that leveling the playing field among
producers from all nations is the best way of matching global supply to demand while making
all people involved more prosperous.
1
The unrestricted purchase and sale of goods and services between countries without the
imposition of constraints such as tariffs, duties and quotas is known as free trade. Free trade
is a win-win proposition because it enables nations to focus on their core competitive
advantage(s), thereby maximizing economic output and fostering income growth for their
citizens.

For example, farmers of cocoa beans and cottage industry manufacturers of cocoa products
could sell their good without any interference from the government in the form of tariffs,
subsidies, price controls and any other kind of financial involvement in their business. Free
trade would mean a complete Laissez-faire state in the domestic trade economy where each
sellers independence would be maintained.

The idea of market freedom might sound very good and attractive but it will have some
drawbacks. Due to reduced government intervention farmers will have lesser financial


support in times such as droughts or floods. And even in the case of unemployment the
traders would be left helpless. The social security net would be lifted and if the demand was
low there would be no law forbidding or helping the traders avoid reducing the price below a
certain level.

FAIR TRADE- In this system of trade the trader accepts that there should be some kind of
intervention from the government to help the disadvantaged sellers in the free market. Fair
Trade aims to help producers in developing countries obtain better trading conditions and
launches the productivity of the traders and producers who indulge in sustainable growth and
production. This means that the free market is no longer in control of the environmental
standards and the producers growth but in the hands of the government or any other body
created specifically to help the producers gain profits while maintaining environmental
standards.
While intervention may protect the interests of the producers in the domestic economy it does
have its disadvantages. Now that there is government intervention the prices of the goods
refuse to come down due to tariffs. This factor plays a negative role in the competition of the
local producers with the international sellers and the imports, which are way cheaper. This
might affect the GDP and also the income level. These problems are faced by the developed
countries because they are in a state of high-mass consumption whereas the developing
countries are In the take-off stage thus allowing them to keep the price level low.

This debate over free and fair trade is what the delegates of our committee should be able to
resolve and strike a fair balance in their implementation as policies.






General study of the problem/Overview

Expectations that emerging markets could boom for decades havent come true. Advances in
technology over the past five years have facilitated the rise of state capitalism and made it
easier for companies to stay in their borders. And unlike at just about any time in the past six
decades, the political leadership of almost every major economy is weak, making it easier for
protectionism to flourish. The era of free trade as the world has known it is dangerously close
to coming to an end.
The belief that trade flows would inevitably increase was based on two assumptions:
Emerging markets still had huge space to expand, and new technologies would make
businesses more interconnected. These ideas still power reports such as HSBCs forecast. But
they appear to be wrong. Todays technological advances dont necessarily lead to economic
integration. The latest breakthrough in manufacturing, 3D printing, makes it easier for
companies to keep their design and initial production work in-house and cut out suppliers


which reduces trade, because it removes incentives to outsource later rounds of
manufacturing overseas. The coming breakthrough in many science-based industriessuch
as synthetic biology, in which living forms are created from strands of DNAwill similarly
create pressure for companies to keep operations in-house. Already, many corporations are
coming home: Cross-border investment inflows fell by 18 percent in 2012 and probably will
drop again in 2013.
Far from creating a long tail, globalization and the Internet have instead made economies of
scale more important to companies survival. That has prompted consolidation in industries
from telecommunications to oil to mining, allowing many of these industries to become
dominated by giant state-owned companies from countries such as China, Russia, and Brazil.
These state-owned enterprises are hardly forces for free trade: They often crush entrepreneurs
in their own societies, and they often push for protectionist barriers, not against them.
STORY: What's going on in the Waters of Global Trade (As per Dec, 2012)
As for the big emerging markets, they arent proving as resilient as expected, despite their
huge consumer classes. Chinas economy has slowed only marginally, but every other major
emerging economy, from India to Brazil, has seen its growth drop precipitously the past two
years. (When all the figures were finally in and calculated this summer, it turned out that
Brazils economy grew by only 0.9 percent in 2012, far less than Brazilian leaders and
economists had forecast.)
Many of these, such as India, have based their hopes for growth on services, not the export-
oriented manufacturing that enriched Japan and the Asian tiger economiesand before them
Britain, the U.S., and other countries. As economists Amartya Sen and Jean Drze note,
services not only employ fewer people than manufacturing, but they also face far more trade
barriers by developed nations than manufactured exports.
These challenges might be surmountable if a stronger international consensus in favour of
free trade existed. Over the past 60 years, at least one major economy was able to take the
lead in advancing the global trade agenda. Today, however, every prominent trading
economy is too consumed by problems at home. Weakened by the shaky rollout of health-
care reform, President Obama faces a hostile Congress that has little inclination to support
either the administrations proposed free-trade agreement with Asia, called the Trans-Pacific
Partnership (TPP), or a U.S.-European trade pact. Chinas top leaders are still trying to
consolidate power and address domestic challenges such as land reform. Britain is consumed
with austerity, Japan is embarking on contentious economic reforms, and Germany is
constrained by its history and Berlins consensual politics. Reports of U.S. spying on top
European leaders have caused politicians across the European Unionalready sceptical of a
trans-Atlantic trade zone because of concerns that many European industries would be
swampedto call for trade negotiations with the U.S. to be cut off. As of early December,


negotiations have resumed, but the prospects for a deal remain highly uncertain.

The Free Trade Argument
The classical pro-free trade argument cites the benefits of the increased competition and
specialization that free trade brings: lower prices/costs, more variety of goods, and higher
quality of goods. In the longer term, these factors increase productivity growth and living
standards. Another common argument veers more toward the political side: trade barriers can
cause conflict between countries and lead to fearsome trade wars that destroy the potential for
mutual benefits from trade, and also spark the possibility of military conflict.
A more contentious justification for free trade is its effect on job creation. As Daniel
Griswold, director of the Center for Trade Policy Studies at the Cato Institute, states, Using
data from the U.S. Bureau of Labor Statistics, I have shown that most of the net new jobs
created in the United States in the past two decades have been middle-class service jobs that
actually pay more than the average manufacturing job. This would dispel the protectionist
argument that free trade eliminates domestic jobs from high-value-added and high wage
sectors (such as those in manufacturing) and forces workers in these sectors to take on low-
value-added, low-wage jobs in non-tradable sectors (food service, law enforcement, etc.).
The Protectionist Argument
Before I begin to summarize the protectionist view, I think its necessary to clarify a common
misrepresentation of it. No protectionist economist in his/her right mind is proposing to
abolish international trade altogether. Protectionists and free traders alike, acknowledge that
the benefits of trade undeniably exist. Their views diverge when it comes to the benefits
of free trade, aka trade without restrictions.
Protectionists argue that a free trade policy of one country incentivizes the countries it trades
with to practice mercantilism (an economic policy aimed at accumulating monetary reserves
through a positive balance of trade, especially of finished goods, and manipulate their
currencies in order to maintain this positive balance of trade. Given the recent news and
numerous blog posts about the subject, its quite possible that China is doing this very thing.
Another lesser know view is the doubt some protectionists, such as Ian Fletcher, cast on
David Ricardos theory of comparative advantage the foundation for most pro-free trade
arguments. Fletcher, an Adjunct Fellow at the U.S. Business & Industry Council, calls
attention on the fact that Ricardos theory only discusses maximizing present consumption
through free trade. It does not distinguish between the long and short run, and therefore
cannot properly be used as a justification for the long run benefits of free trade.








How do trade imbalances trigger a crisis?

A country with a short-term debt position to foreign lenders may be vulnerable to a
catastrophic run, just as banks are, if there are insufficient liquid securities to pay off lenders.
Concerns about such runs, of course, have featured prominently in todays ongoing European
economic instability.


What has been done to correct imbalances?
Global trade and debt imbalances are a rising cause for concern. In 2006, the International
Monetary Fund launched an initiative to unwind the large global imbalances in an orderly
fashion. In 2010, the European Commission launched a surveillance framework covering an
array of potential macroeconomic imbalances, to include trade balances. This framework
represents an important extension to the narrower inflation and public finance targets set by
the Maastricht Treaty for entry into the European single currency.
A comprehensive review of existing orthodoxies by policy makers must go beyond public
finances and inflation and attack trade imbalances. Recent extensions to the system are still
not enough. Adequate surveillance requires not only knowledge of the size and direction of
global trade flows, but a fuller understanding of how those flows affect global economic
developments.

Where are we now?
The current global slowdown is a structural one, not a cyclical one, and structural transitions
are rarely smooth. A crisis reflects a market failure to allocate capital where it is needed most.
So, crises and instability may be frequent unwanted guests as capital market forces exert their
influence.
Consider the most glaring global dysfunction the US has been running a current account
deficit since around 1982 with a cumulative trade deficit now standing at about 50 per cent of
gross domestic product. This translates into non-US banks holding around $6tn in claims on
the US, again about half of total nominal US GDP.
Moreover, cumulative current account deficits exist elsewhere. The UKs cumulated trade
balance now stands at a deficit of about 30 per cent of GDP, and Australia has a deficit of
about 60 per cent of GDP. As the balances must equal zero worldwide, there are also the
surplus countries. Germany shows a cumulative trade surplus of about 45 per cent of GDP,
while Switzerland shows a surplus of about 120 per cent.

The worlds current account balance is not the only problem. At the global level, liabilities
tend to exceed assets; the world as a whole is a net debtor. Mr Zucmans research suggests
that this is to do with tax havenswhere assets are underreported.
A countrys excess spending over income must, by definition, be sustained by sales of
foreign assets or loans from other countries, these deficits translate into surplus countries
predominantly Switzerland, Japan, China, and Germany holding more than $8 trillion in
cumulative claims against deficit countries.


A country with a current account deficit is a net consumer that is becoming increasingly
indebted. Its spending and investment are more than its production. This outcome can occur
only if other countries are lending their savings to it or if the country is running down its
capital account assets. But a country that is running a current account surplus is accumulating
wealth and staking claims on foreign assets.





The Doha Round
The Doha Round is the latest round of trade negotiations among the WTO membership. Its
aim is to achieve major reform of the international trading system through the introduction of
lower trade barriers and revised trade rules. The work programme covers about 20 areas of
trade. The Round is also known semi-officially as the Doha Development Agenda as a
fundamental objective is to improve the trading prospects of developing countries.
The Round was officially launched at the WTOs Fourth Ministerial Conference in Doha,
Qatar, in November 2001. The Doha Ministerial Declaration provided the mandate for the
negotiations, including on agriculture, services and an intellectual property topic, which
began earlier.
In Doha, ministers also approved a decision on how to address the problems developing
countries face in implementing the current WTO agreements.


What Is the U.S. Trade Deficit with China?:
In 2012, the U.S. trade deficit with China was $315 billion. This was up significantly from
the year before, when thetrade deficit was $295.4 billion. Both were higher than any prior
year.
The trade deficit exists despite the fact that U.S. exports to China were the highest in history.
In 2012, the U.S. exported $110.6 billion in goods, an all-time record. Exports in 2011 were
only $103.9 billion. However, imports from China also set a record -- $425.6 billion, more
than the $399.3 billion imported in 2011.
The U.S. imports consumer electronics, clothing and machinery from China. A lot of the
imports are from U.S.-based companies that send raw materials to China for cheap assembly.
When they are shipped back to the U.S., they are called imports even though they are
profiting American-owned companies. (Source: U.S. Census, U.S. Trade in Goods With
China)







Why Is There a U.S. Trade Deficit with China?
Quite simply, China is able to produce goods that Americans want at the lowest cost. How
does China keep prices so low? Most economists agree that China's competitive pricing is a
result of two factors:
1. A lower standard of living, which allows companies in China to pay lower wages to
workers.
2. An exchange rate that is partially set to be always priced lower than the dollar.
However, this means that many American companies can't compete with China's low costs.
As a result, many jobs are lost. From time to time, legislators try to impose tariffs or other
forms of trade protectionism against China to bring jobs back. However, if this were to
actually happen, U.S. consumers would have to pay higher prices for their "Made in
America" goods. That's why it's unlikely that the trade deficit will change. Most people
would rather pay as little as possible for computers, electronics and clothing -- even if it
means other Americans lose their jobs.

What Does China Export?:
China does a lot of manufacturing for foreign businesses, including U.S. companies. The raw
materials are shipped to China, where factory workers build the final products and ship them
back to the U.S. In this way, a lot of China's so-called "exports" are really for American
companies for American consumers. China primarily exports electrical and other types of
machinery, especially computers and data processing equipment, as well as optical and
medical equipment. It also exports apparel, fabric and textiles.
It imports raw commodities from Latin America and Africa, such as oil and other fuels, metal
ores, plastics and organic chemicals.


India and WTO
India is developing country and has been helped by the WTO in regulating its trade policies
and exchanges since it joined the WTO in the beginning of 1995.

Recently, in the news is the dispute over Indias rejection of the WTO trade facilitation
agreement (TFA). India has made its stance clear that it will not easily give in to pressure
from the Western world over trade protocols of the World Trade Organization, as was also
discussed during the talks in Bali in December 2013. India fears that agreeing to the trade
facilitation agreement (TFA) could compromise its own food security.

What is the TFA?
The TFA aims to fast track any movement of goods among countries by cutting down
bureaucratic obligations. The problem with TFA runs in a clause that says farm
subsidies cannot be more than 10 percent of the value of agricultural production.

The problem India has with the TFA is that for its national development and support to the
local farmers the government needs to provide a subsidy of more than 10%. But if the
subsidy cap was implemented the support would reduce and instead the prices would soar.


The governments objective is to reduce the price but the subsidy cap would mean farmers
trying to meet domestic competition and increasing their price.

The global economy and the WTO want India to agree to the TFA because if India increased
subsidies for the poor farmers this would put the poor farmers in other countries at a
disadvantage in the competition. This would mean that they would have to increase their
prices and lose demand due to WTO regulation but India would have their production process
at subsidized rates.

This is a perfect example of two different views on free and fair trade. The dilemma
presented here is one the committee will have to resolve.

Solutions & Guiding Questions

Another problem faced by the developing and underdeveloped countries of the world is the
occurrence of Trade Imbalances.
The term Balance of Trade means the difference in monetary value of imports and exports of
a country over a certain period of time. The balance measures the relationship between the
two trade sectors and gives the economy a positive or negative balance of trade.

A positive balance in trade would occur when the country is exporting goods and services
more than importing them. This would show a noticeable growth spike in the GDP of the
country. It would project better growth In the local industries and provide the country with an
incentive to reduce trade barriers and tariffs in and outside the country.

A negative balance would occur when the imports for a country would surpass the monetary
value earned through the exports of the country. This would mean that certain sector of goods
would generate more income internationally rather than domestically. This would mean an
increase in the international tariffs and barriers to reduce the competition for the local
producers. This would lead to a negative spike in the GDP and an overall imbalance in trade.

So why is this imbalance caused?
There are many reasons such as-
I. The cost of production in the exporting company,
II. The availability and cost of raw materials that are used to create these products
III. The current exchange rates
IV. Any unilateral, bilateral or multilateral taxes or restrictions that impede the movement
of certain products
V. The current prices of goods that are manufactured at home.
As a committee and as individual delegates its your duty to address these causes and
check whether your country is facing any trade imbalances in any sector and come to a
consensus with a solution that benefits all countries in the trade sector and eradicates
the problems efficiently.

Some possible solutions for the committee to consider are-
1. To increase domestic competition the government could increase the support to local
producers so that exports could be increased.
2. This would also help in creating free trade for a temporary time and also lead to some
international tariffs being implemented.


3. Protectionism could also be presented as a solution but it would completely interfere
with the solutions proposed by the free and fair trade sector. This would again raise
arguments and imbalance in the economy.
As delegates its your job to find the right and sustainable solution for correcting trade
imbalances so that global economy is stabilized in the most efficient and productive way.
What is a trade barrier?
Trade barriers are often tariffs and taxes imposed to protect - or favour - local producers.
International efforts to remove these discriminatory tariffs have been ongoing for over 50
years, coordinated initially by the General Agreement on Tariffs and Trade, followed by the
World Trade Organization (WTO) and nine rounds of the international trade negotiations
which govern the current WTO system.
Non-tariff barriers are increasingly significant and varied and can be more difficult to
overcome. Some non-tariff barriers have sensitive cultural and social issues, or appeal to
legitimate concerns, which must be considered. Other non-tariff barriers can create
unjustified obstacles to fair trade and can come in many forms, such as:
Technical regulations, standards and conformity assessment procedures
Labeling rules
Poor protection of intellectual property rights and geographical indicators
Misuse of sanitary and Phytosanitary measures
Unfair subsidies
Unjustified trade defence measures - such as anti-dumping actions
Discriminatory taxation and other additional fees
Ad hoc bans and prohibitions on imports - eg those implemented on the basis of
spurious claims to protect the health and safety of citizens
Non-automatic licensing procedures
Customs procedures
Quantitative restrictions
Government procurement
Restrictions on access to raw materials
Barriers to trade in services and investment

Some instances where fair trade and free trade has faced barriers-
Example 1: Ghana
Cocoa is a major ingredient in chocolate. Kofi and Kwame are cocoa farmers in Ghana,
a country in Africa. They both rent land which they use to grow cocoa trees and vegetables
for food. They both harvest their crops of cocoa pods at the same time. The cocoa pods
contain beans, which both Kofi and Kwame ferment and dry. Kofi is a member of a fair trade
co-op. They give Kofi a fair price for his cocoa beans. He can also get advice on better
growing techniques and an advance if he needs it. Kwame lives in a remote part of
Ghana. He has no access to fair trade co-ops. Kwame relies on a local middleman to take
his cocoa beans to a government run buying centre - a market for cocoa beans. Kwame only
sees a small percentage of the final price of the cocoa beans. All his hard work is for nothing
as he makes a loss on this years crop. Kofi on the other hand has made enough to invest in
machinery to make harvesting easier and next year he hopes to be able to send his young
daughter to
boarding school. The cocoa beans meanwhile are sent to Europe for processing. Kofi's beans
have gone to Fair Trade organizations to be processed into cocoa and chocolate. Kwame's
cocoa beans will also be processed into cocoa and chocolate, but a large multinational will do
this. The cocoa beans will eventually end up as milk or dark chocolate bars on the shelf of
your local shop. The chocolate snacks you eat may have come from farmers like Kwame and


Kofi in Ghana. Yet the names we all recognize when it comes to chocolate are Nestle, Mars
and Cadburys. Large companies make enormous profits each year while farmers like Kwame
struggle to survive
Example 2: Ireland
Another main ingredient is sugar. Sean is a sugar beet farmer in County Carlow. He owns a
150 acre farm, where he and his family live in a large house. He has sent his two daughters
to University in Dublin. He employs a farm hand who he is considering letting go as he
may purchase some new labour saving machinery which will save him time and money. Each
year Sean grows sugar beet which he sells at a profit to the sugar refinery. Until four
years ago he used a trucking company to take his beet to the factory but over the years he
saved enough to buy his own truck, which he now hires out at other times of the year. Sean
gets an EU subsidy which guarantees him an income when the price for beet is low or
for years when his yield is not so good, and results in him maintaining a level standard of
living. He has a guaranteed market for his goods, as EU policy gives preference to his sugar
beet over any imported from non EU countries.

The committees responsibility is to address the problems in free and fair trade. Looking at
the examples above you can tell that the domestic producers are going into a loss. Their
profits are marginal and their hard work is being converted by the big companies as their own
work.

What are some solutions to this whole problem -

1. The government can introduce a department responsible for the proper and diligent
marketing of the goods made by the local producers.
2. The tariffs on the producers could be reduced to provide the incentive of increasing
the investment in the area.
The above stated are just simple solutions with no backing up. We all know that these have to
be addressed. But you, the delegates of this committee need to find a way to implement these
solutions. Find a way that does not create another imbalance in the correction of this
imbalance.

Concept of Aid for Trade

Aid for Trade comprises of the following aspects:

Technical trade-related assistance for example, helping countries to develop trade strategies,
negotiate trade agreements, and implement their outcomes;

Trade-related infrastructure for example, building roads, ports, and telecommunications
networks that connect domestic markets to the global economy;

Productive capacity building (including trade development)for example, providing support to
allow industries and sectors to build on their comparative advantages and diversify their
exports;

Trade-related adjustment assistance helping developing countries with the costs associated
with trade liberalization such as tariff reductions, preference erosion, or declining terms of
trade;



Other trade-related needs if identified as trade-related development priorities in partner
countries national development strategies.

Protectionist policies

The World Trade Organization must aim to make sure that all forms of protectionist policies
by countries actively engaging in trade are removed, if it is hindering their trade process and
capabilities. The countries that actively participate in trade and attempt to protect selective
sectors of their economies from foreign competition exhibit a dire need of protectionist
measures but that should only take place if they are safeguarding the interests of other
economies, while not exploiting global resources. Furthermore, the use of economic sanctions
by countries, outlined by the basis of a countrys security and/or political situation must also
be reviewed in order to determine what the circumstances to allow such measures should be.
Therefore the reasons that form the base for the formation and existence of these measures
need to be negotiated. The countries trying to economically manipulate weaker ones (namely
developing countries and

LDCs) should be adequately restricted from doing so, while still safeguarding the principles
of the World Trade Organization. The member states must also take notice of the nations
attempting to delude the global populace by advocating for free trade for their own country
while for other countries they impose protectionist measures. Protectionist measures are a
vast area of debate and
must seek to incorporate advantages and interests of all member nations.


To start of your research on your country and the agenda here are some guiding questions-
The best link to visit for your research would be the WTO site to find out your
countries position on the agenda- http://www.wto.org/index.html
Is your country a developing country or is it under-developed?
Does your country face the problems with the balance in trade: meaning; are there a
lot of trade tariffs in your country?
What are your main exports and imports?
What major types of economies run in your country? Eg: monopoly/oligopoly
What is your countrys economic growth history and the factors that affected it?
If you represent a developed country, how do you evaluate the free-trade agreement
with developing nations?
If you represent a developing country, how will you make sure your interests are
protected and safeguarded if a free-trade agreement is to be signed with a nation
having a much better economy than yours?
What is your countrys stance on protectionist measures imposed by other countries?

What is your countrys contribution (The steps taken in the past, and the steps being
undertaken in the present) in solving the global trade imbalance issue?
What were/are the major issues that have shaped the global scenario of trade?
Major trade agreements between nations
Current major economic issues that are playing the rounds globally. For example the
Doha Rounds.