Dispute settlement mechanism in the WTO and developing countries Essay

Dispute settlement mechanism in the WTO and developing countries - Essay Example The purpose of this paper is to examine the mechanism of the world trade organization to settle the disputes that occur between the parties of the organization. Research will compare the system of GATT and the WTO system to settle disputes. In addition; it will explain how the system works. Also it will show the benefits that the system provides for developing countries. And it will be some cases of the disputes that the system remedied. The increasing predominance of the capitalist system, globalization and the consequent reduction of the world into some form of global village have resulted into the fast integration of the world’s economic system. This development is characterized by countries engaged in constant bilateral and multilateral relationships as they deal with each other with the highly dynamic and freer flow of goods and services in the international market in addition to the internationalization of production. David Held (1999) argued that historical evidence at both the world and country levels demonstrate that the higher level of trade today is inevitable – from the Classical Gold Standard period to the postwar growth in trade.1 An illustration of the growth of global trade is demonstrated in fig. 1. This phenomenon was made possible by the advances in modern technology, transportation and communications as well as the global trade liberalization that have paved the way for a highly evo lved economic system. Central to globalization is the World Trade Organization, the international body that institutionalized the world trade system. It is this organization that has worked to increase trade between countries by ensuring that tariffs, state control systems are lowered and protectionism by governments on domestic industries is eliminated. The environment that is created by the modern economic system often breeds conflict as countries navigate the complexities of trade. As nation-states become naturally enmeshed and interdependent