WTO Retaliation: Effectiveness and Purposes

This book explores the problems of WTO retaliation, the question of its effectiveness, and the purposes of retaliation. It argues that WTO retaliation can have multiple purposes, including inducing compliance and reaching a mutually agreeable solution, and evaluates the reasonableness and soundness of WTO retaliation in light of its multiple purposes through extensive research and case studies.

Format: Paperback / softback
Length: 208 pages
Publication date: 25 July 2019
Publisher: Bloomsbury Publishing PLC

The central theme of this book revolves around three fundamental issues: the challenges associated with WTO retaliation, the question of its effectiveness, and the objectives behind retaliation. WTO retaliation is frequently perceived as ineffective due to inherent limitations. This book underscores the importance of identifying the purposes of retaliation before assessing its effectiveness. In other words, it advocates for a purpose-based approach to evaluating the efficacy of retaliation. It is widely accepted that the primary objective of WTO retaliation is to induce compliance. However, this book presents a compelling argument in favor of the coexistence of multiple purposes of retaliation, encompassing the pursuit of mutually agreeable solutions. These perspectives are grounded in extensive research conducted on the purposes of WTO retaliation, encompassing the interpretation of Article 22 of the DSU, examination of remedies rules within the frameworks of public international law, and analysis of academic writings and debates, as well as the statements of arbitrators. Furthermore, by evaluating a series of disputes involving WTO retaliation, this book showcases the reasonableness and soundness of WTO retaliation in light of its diverse objectives.

Introduction:
The World Trade Organization (WTO) is a global institution established to promote trade and ensure fair competition among nations. However, the use of retaliation as a means of enforcing trade rules has been a contentious issue within the WTO framework. While retaliation can be seen as a tool to protect domestic industries and promote compliance, it can also lead to unintended consequences and undermine the effectiveness of the WTO's dispute resolution mechanism.

Challenges Associated with WTO Retaliation:
One of the primary challenges associated with WTO retaliation is its potential to create a cycle of retaliation and escalation. When one country retaliates against another for violating trade rules, it can lead to a tit-for-tat response, where both countries impose tariffs and other measures that harm their trade relations. This cycle of retaliation can be difficult to break and can escalate into a full-fledged trade war, which can have far-reaching economic consequences.

Question of Effectiveness:
Another challenge associated with WTO retaliation is its effectiveness in achieving its intended objectives. While retaliation can be a powerful tool to induce compliance, it is often deemed ineffective due to its inherited shortcomings. For example, retaliation may not be able to address the root causes of trade violations, such as unfair competition or government subsidies. Additionally, retaliation can lead to trade imbalances and undermine the stability of the global trading system.

Purposes of Retaliation:
Despite these challenges, there are also arguments in favor of the multiple purposes of retaliation. Some argue that retaliation can serve as a means of protecting domestic industries and promoting fair competition. By imposing tariffs or other measures, countries can prevent foreign competitors from gaining a unfair advantage in the domestic market. Additionally, retaliation can be used as a deterrent against future trade violations, as countries may be less likely to engage in such behavior if they know that they will face consequences.

Purpose-Based Approach to Effectiveness:
In response to these challenges, there is a growing trend towards a purpose-based approach to evaluating the effectiveness of WTO retaliation. This approach emphasizes the importance of identifying the specific objectives of retaliation before implementing any measures. By aligning retaliation with the specific goals of protecting domestic industries or promoting fair competition, countries can more effectively achieve their objectives and minimize the unintended consequences of retaliation.

Conclusion:
The use of retaliation as a means of enforcing trade rules is a complex issue that requires careful consideration. While retaliation can be a powerful tool, it is important to identify the purposes of retaliation prior to evaluating its effectiveness. A purpose-based approach to evaluating retaliation can help countries achieve their objectives while minimizing the unintended consequences of retaliation and promoting the stability of the global trading system.

Weight: 326g
Dimension: 155 x 233 x 15 (mm)
ISBN-13: 9781509930173