WTO Members Strike a Deal in Bali to Remove Barriers to Global Trade

Barriers to global trade will hopefully be removed with the recent deal among members of the World Trade Organization (WTO) and the United States in Bali, Indonesia. On Saturday, the U.S. and WTO members inked a $1 trillion deal in a meeting attended by some 159 nation members.

First deal in two decades

This is the first deal in almost two decades since the WTO was organized in 1995 that an agreement to ease out the disparity between the rich countries and poor countries has been reached. According to reports, Roberto Azevedo, Director General of WTO, was emotional during the closing program on Saturday when he expressed gratitude to Indonesia, the host country, member countries of the WTO and his spouse. He said that the deal has put the world back to the World Trade Organization, and that for the first time in history of the WTO, it has truly delivered.

 

The focal point of the pact was on the simplification and transparency of customs requirements so that trade among different economies around the world will prosper for the benefit of every country. Notably, there had been unsuccessful talks in previous years on how to boost world trade and that the WTO had merely become a court for trade controversies among nations.

Getting rid of red tape

According to the United States Chamber of Commerce, red tape and bureaucracy are the culprits in the slowing down of international trade. If these two factors are lessened, then world economy will be uplifted.

Bali package

The new agreement, known as the “Bali Package” aims to make the flow of goods faster through more simplified procedures. This package is said to cut trade expenses by 10-15% inasmuch as there will be less paperwork and delays in transit at the border areas will be diminished. Officials of the Organization for Economic Cooperation and Development (OECD) said developing countries will be able to save an estimate of $445 billion annually which will in time result to more fiscal benefits in the global scene. The Bali contract also permits third world nations to avail of subsidized food stock for their poor citizens.

Indonesian Trade Minister Gita Wirjawan stated that the just concluded meeting of WTO member economies revolved around diplomatic dealings. Moreover, she said, it reached a significant agreement that ensures benefits for small businesses and developing economies through multilateral trading relations.

Same rules

With the agreement, the WTO would spend time to develop a new approach in moving forward the Doha negotiations. This is necessary so that new changes in trade practices will adapt to new rules, subsidies, and taxes for countries with lower incomes.

Meanwhile, China and the European Union have come up with a solar panel deal through the WTO. This is seen as good news and an important development that will place the WTO in a better light. For many years, the organization has lost its grip on world economies, thus causing many nations to become doubtful of its capabilities to catapult world economy to a better position.

 

Photo Credit: World Trade Organization logo