In international trade relations, countries resort to various economic tactics to gain a competitive advantage in the global market. Often, countries will try to maximize the production of the commodities they are rich in by increasing their export and minimizing the importat of the products they are less interested in. The export and import are determined by economic strategies such as trade barriers. A country can adopt trade barriers such as embargoes, tariffs, and quotes. The trade block can be imposed to manage the competition of foreign industries against the local industries, and this can be unhealthy to some countries. It is the duty of the World Trade Organization to settle and balance the situation without victimizing the partnering country.

The case at hand features the United States and Bangladesh trading relationship. Despite the two states having a bilateral trade and investment agreement signed in 2014, the US has managed to suppress Bangladesh by dominating the relationship and selling computer software s well as setting barriers for Bangladesh to export rice to the United States. The US has achieved this by imposing protective tariffs, quotas, and embargoes on the Bangladesh government. The USA set high protective tariffs on Bangladesh rice imports to make their prices hike more than other rice import options thereby reducing Bangladesh’s rice competition. The quotas have limited the amount of rice Bangladesh can export to the United States allowing only intermittent import of few tons of rice compared to the earlier years. Sometimes, the US resorts to embargoes by completely stopping the importation of rice and claiming to be interested in other Bangladesh products like cotton, fabric, iron, and steel. The US chose to adopt these mechanisms mainly to improve their negative balance of payment against Bangladesh, which was $4.6 billons in the year 2013.

The relationship is unfavorable for Bangladesh, and the World Trade Organization has a role to play and solve this dispute. WTO can adopt steps like enforcing international rules of trade, providing a forum for resolving disputes, urging the US to lower their tariffs, and removing the embargoes and quotas. Applying an international standards will provide guidelines which check on the policies adopted by trading states. The guidelines will help to identify any instances of violation. In this case, United States have violated the trading rules. Despite the fact that WTO has no legal right to force a country to do anything it does not want to do, it can force the country to do what it wants to do, but it cannot still direct the US to slash off the unfavorable policies. In case the US fails to comply, WTO can advise Bangladesh to counter the United States by erecting trade restriction on them mainly in the form of tariffs.

The forum of resolving disputes provided by WTO is an arbitrative system that aims at solving trade disputes amicably among countries. The US and Bangladesh can send their trade representatives to discuss the conflict and come with favorable decisions, which will benefit both of them. Regarding the issue of tariffs, quotas, and embargoes, WTO has the mandate to urge the US to uplift these barriers because the two countries are strong mutual trade partners. Sometimes, it is hard to completely remove bans and tariffs. Therefore, countries are advised to lessen the restrictions to avoid suppressing the partner country.

If the mentioned steps can be adhered to, there will be no more trade wrangles between the US and Bangladesh. The two states will enjoy a balance of payment to improve their economy and the world economy at large.

About the author: Jessica Sanders is a bachelor in English philology and sociology at California University. Jessica is currently working as one of the best writers at the nursing student cover letter writing service She also studies feminine psychology.


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