What Is Unilateral Trade Agreement
The following section assesses the impact of EU trade preference regimes for least developed countries and DCs, with Mozambique being considered a case study. What is a unilateral trade agreement? It is simply a treaty that requires only the action or initiative of a state. Unilateral trade policies can be tariffs, or they can be preferential trade programs such as the U.S. GSP and be used as a strategy to promote economic growth in developing countries. What is a unilateral trade agreement? It is a treaty that benefits only one state, is imposed on one nation by another, and has the potential to support the economies of developing countries. One of the challenges of the WTO system has been the maintenance and expansion of the liberal global trading system in recent years. Multilateral negotiations on trade liberalization are progressing very slowly and the need for consensus among the many WTO members limits the scope of trade reform agreements. As Mike Moore, a new WTO Director General, said, the organization is like a car with an accelerator pedal and 140 hand brakes. While multilateral efforts have reduced tariffs on industrial products, they have been much less successful in liberalizing trade in agriculture, textiles and clothing, as well as in other sectors of international trade.
Recent negotiations, such as the Doha Development Round, have been difficult and their ultimate success is uncertain. Within the framework of the World Trade Organization, different types of agreements are concluded (most often in the case of new accessions), the terms of which apply to all WTO members on the most favoured basis (MFN), meaning that the advantageous conditions agreed bilaterally with a trading partner also apply to other WTO members. Some Conservatives define unilateral trade policy as the absence of a trade agreement. In this definition, the United States would lift all tariffs, regulations and other trade restrictions. It is one-sided because it is not necessary for other nations to do the same. The argument is that the government should not restrict the rights of its citizens to trade around the world. Despite the potential tensions between the two approaches, it appears that multilateral and bilateral/regional trade agreements will remain characteristics of the global economy. However, both the WTO and agreements such as NAFTA are controversial among groups such as alter-globalists, who argue that such agreements serve the interests of multinationals and not workers, while free trade was a proven method of improving economic performance and increasing overall income.