Why Nations Prefer to Negotiate the Bilateral Trade Agreement than the Wto

In recent years, the trend of negotiating bilateral trade agreements has gained popularity among nations around the world. Bilateral trade agreements, also known as BTAs, refer to deals made between two countries to reduce or eliminate trade barriers such as tariffs, quotas, and other restrictions on a particular set of goods or services.

At the same time, the World Trade Organization (WTO) was established in 1995 to oversee and regulate global trade, provide a platform for member countries to negotiate multilateral trade deals, and resolve trade disputes. However, despite the WTO`s efforts, many countries prefer to negotiate BTAs over multilateral agreements.

One of the primary reasons nations are inclined towards BTAs is that they offer more flexibility than multilateral agreements. With BTAs, countries can tailor the terms of the agreement to best suit their individual needs and priorities. This method increases the likelihood of achieving a mutually beneficial trade agreement and enables nations to protect their industries, which is especially important for developing countries.

Furthermore, BTAs are often considered to be more effective in resolving trade disputes than the WTO. The WTO`s dispute resolution process is infamous for being time-consuming, bureaucratic, and often ineffective. In contrast, BTAs offer a more informal and less formalized dispute resolution mechanism, which can lead to a speedy resolution of disputes.

Another advantage of BTAs is that they can provide quicker results than multilateral agreements. Negotiating a multilateral agreement between a group of countries can take years or even decades to finalize, while BTAs can be signed relatively quickly. This speed is essential in the current global economic climate, where changes in trade patterns and technologies happen at a rapid pace.

Moreover, BTAs allow nations to bypass the strict and cumbersome rules regarding intellectual property and investments that the WTO imposes. The WTO requires a broad consensus on issues such as intellectual property and investment that BTAs do not, enabling nations to negotiate and settle these issues on their own terms.

Lastly, BTAs allow countries to focus on specific sectors, products, or services, leading to more tailored agreements that benefit the participating countries. The WTO`s broad scope can make it challenging to address specific trade issues and priorities for individual countries.

In conclusion, BTAs have several advantages over the WTO, such as offering flexibility, speedy resolution of disputes, quicker results, and the ability to focus on specific issues. These benefits are especially useful for developing nations that require the necessary protection for their industries. While the WTO continues to play an essential role in regulating global trade, it is no surprise that nations prefer BTAs to address their specific needs and priorities.