You are a member of a World Trade Organization task force that is reviewing the
ID: 345973 • Letter: Y
Question
You are a member of a World Trade Organization task force that is reviewing the nine-year banana conflict between the United States and the European Union (EU). The EU was giving preferential treatment to banana exporters from Africa, the Caribbean, and the Pacific island nations. But the United States challenged what it saw as unfair trading practices and the World Trade Organization agreed. The U.S. action gained support from global fruit companies Dole, Chiquita, and Del Monte, which account for nearly two-thirds of the fruit traded worldwide. The EU argued it was supporting struggling economies for which bananas make up a large portion of their income.
1. Should international trade be left to private enterprise only, or should governments openly manage it to benefit poorer nations?
2. Would you have argued on behalf of the United States or the EU? Explain.
3. What are the pros and cons of each side's arguments?
Explanation / Answer
1. I believe that international trade is a very common an necessary amenity that organizations are using and there are a lot of advantages that comes along with international trade which improves the economic situation of the organization, hence it would be better if government openly manage it because then it will actually benefit the poorer nations. The poorer nations will benefit a lot economically.
2. I would have argued on behalf of the EU because they actually were helping the countries from Africa, Caribbean and pacific by reducing the impart duty to a minimum as compared to that of the EU countries. The protest was first forwarded by countries like Colombia, Costa Rica, Guatemala, Nicaragua, and Venezuela who proposed that the EU was doing illegal activities by violating the norms of the GATT. USA came into the picture after quite some time and the issues increased with their entry.
3. I believe that EU was trying to help the ACP countries economically by reducing their duty charge again there are economically weak countries in Latin America too and they were deprived of such facilities, which was illegal, therefore I believe that the initiative taken by the EU was noble but it was discriminating some countries too and therefore it should have been granted to other economically weak countries too which would have not made the issue grow.
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