Re:Ghana will no longer sell cocoa to Switzerland
by yorwba on Friday March 19, 2021 @10:47AM
(#26513950)
They didn't exactly ignore them.
A WTO member can either comply with their treaty obligations (e.g. reducing barriers to trade) or have other members apply their own remedies (e.g. punitive tariffs.)
If the effect of compliance is worse than the punishment (e.g. underdeveloped industry eliminated by foreign competitors vs. continuing to operate despite high tariffs) they'll not comply.
If the punishment is worse (e.g. industry is basically competitive, but tariffs would make products hard to sell in foreign countries) they'll choose compliance.
At the bilateral level, there's not much difference to the pre-WTO situation, which might make you wonder whether it's all pointless. The advantage of the WTO is that it provides a shared target for compliance: if a country follows WTO rules, pretty much every other member will be happy with that. Which is a bigger incentive than having to please every trading partner individually.
A WTO member can either comply with their treaty obligations (e.g. reducing barriers to trade) or have other members apply their own remedies (e.g. punitive tariffs.)
If the effect of compliance is worse than the punishment (e.g. underdeveloped industry eliminated by foreign competitors vs. continuing to operate despite high tariffs) they'll not comply.
If the punishment is worse (e.g. industry is basically competitive, but tariffs would make products hard to sell in foreign countries) they'll choose compliance.
At the bilateral level, there's not much difference to the pre-WTO situation, which might make you wonder whether it's all pointless. The advantage of the WTO is that it provides a shared target for compliance: if a country follows WTO rules, pretty much every other member will be happy with that. Which is a bigger incentive than having to please every trading partner individually.