About the book -
Created some 15 years ago to deal with the rules of trade between nations, the World Trade Organization (WTO) permits its members to retaliate against one another by raising trade tariffs and imposing sanctions in the event of continued non-compliance with WTO trade rules. A sort of “crime and punishment” system. Unlike the trade retaliation procedures of its predecessor, the General Agreement on Tariffs and Trade (GATT) which required consensus, trade retaliation under the WTO, while bilateral in nature (one country imposes sanctions on another for violating WTO rules), is automatically approved subsequent to arbitration. Since its creation trade retaliation measures have been approved no less than 17 times, in eight separate trade disputes. So far, only one developing country, Mexico, has actually implemented the retaliation. ^
Given this picture, WTO Retaliation, as a mechanism, has brooked differing levels of criticism, with analysts arguing in turn that it is tantamount to “shooting oneself in the foot” or that it cannot be successful when the initiator and/or victor is a small or developing country.
Organised around the three questions posed above, this volume seeks to make sense of the WTO retaliation system. Through contributions from leading academics, trade diplomats and practitioners, it analyses the legal rules underpinning the mechanism and assesses the economic rationales and calculations behind it. It offers first-hand accounts of experiences of those countries that have been authorised by the WTO to employ retaliatory measures (trade sanctions, higher levies or duties) such as the US, the EU and Mexico. It analyses the successes and weaknesses of the mechanism. It looks at how the system can be made effective for small countries. Interestingly, it looks at different forms of non-compliance and the levels of response and whether the “punishment” fits the “crime”. Finally, it examines lessons that could be learned from experiences and mechanisms in place in other fields such as remedies for non-compliance in investment arbitration and anti-trust regimes.
By offering perspectives and accounts from contributors drawn from a large range of academic fields – law, economics, political science – this work provides a truly multi-disciplinary analysis of a mechanism that has potentially far-reaching consequences in terms of relations between and among states and the health of the global trade regime.
In a refreshing departure from other compilations, the introduction to this volume does not simply summarise the contributions of the different authors, but brings together the three questions which make up the heart of the analysis and provides an overall picture. The book does not offer any definitive answers to these three questions; rather, readers are given the freedom to examine the arguments put forward from the different disciplinary perspectives and form their own opinions.
Chad P. Bown
