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The World Trade Organisation is based on rules which help prevent discrimination among trading countries, allow the countries to have market access and also help in the elimination of trade barriers. These rules also ensure that there is stability in trade relations and eliminate trade practices that are unjust…
Then after the organisation's final decision a panel is set to hear the issues raised. This panel encourages countries to resolve disputes themselves and if necessary the panel gives compulsory decisions which can be appealed. If a country turns down the appeal then it is forced to change its trade policies or World Trade Organisation authorizes those countries harmed by the policies to impose retaliatory measures to the offending country. These measures include an increase in tariffs, use of subsidies or any other protectionist measure. These measures are a clear indication that World Trade Organisation is based on mercantilist principles and is not aimed at bringing unity among member countries by encouraging free trade. The organisation has principles governing its activities like the non discrimination principle, the reciprocity principle and the transparency principles but it rarely uses them.
Mercantilism is termed as an economic assumption that makes a country prosper. It mostly depends on the capital supply and the volume resulting from international trade. Capital in this theory is represented by silver, gold and any other trade value which the country has. The capital is increased by creating a positive balance in trade with other nations. ...
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