This may seem somewhat pretentious, and it would be incorrect to expect too much. However, the system does contribute to international peace, and if we understand the reasons, we have a clear idea of what the system is actually doing.

Peace is partly the result of the functioning of two of the most fundamental principles of the trading system: the unhindered movement of trade flows and the provision of a constructive and fair platform for countries to resolve disputes on trade issues. It is also the result of international trust and cooperation generated and strengthened by the system.

History is replete with examples of trade disputes turning into war. One of the most striking is the trade war of the 1930s, when countries competed in erecting trade barriers to protect domestic producers and retaliating against competitors' barriers. This was exacerbated by the Great Depression and eventually played a role in the outbreak of World War II.

Two events immediately after World War II helped to avoid a repeat of pre-war trade tensions. International cooperation in the field of coal and iron ore mining, as well as steel production, has been developing in Europe. And at the global level, the General Agreement on Tariffs and Trade (GATT) was created.

Both directions have successfully evolved, and now they are significantly supplemented and significantly expanded - one of them has formed into the European Union, and the other has turned into the World Trade Organization (WTO).

The WTO trading system plays an important role in creating and strengthening confidence in the principles of free trade. Particularly important is such an element as negotiations leading to a consensus agreement with an emphasis on strict compliance with the rules.

Sellers, as a rule, do not want to contradict their customers - the customer is always right. In other words, if trade flows flow smoothly, and participants voluntarily maintain healthy commercial relations for mutual benefit, then political confrontation is practically excluded.

In addition, well-organized trade relations also contribute to the improvement of general welfare at the global level. It also seems unlikely that the population of prosperous and prosperous countries is prone to aggression and the outbreak of military conflicts.

With the growth of trade volumes, the expansion of the range of goods, as well as an increase in the number of countries and trading companies, there is a certain probability that disputes will still arise. The WTO system helps resolve disputes in a peaceful and constructive way.

The countries involved in disputes always strive to act within the framework of existing agreements.

However, there is also a downside to the processes of trade liberalization and expansion. The expansion of trade flows means a greater likelihood of disputes. Let loose, these disputes can lead to a serious conflict. But in fact, escalation of tensions in the field of international trade can be avoided because countries can turn to various organizations, in particular the WTO, to settle their trade disputes.

When "debaters" turn to the WTO, WTO procedures focus their attention on the rules. After a decision is made, countries try to focus on compliance with the rules and, possibly, the subsequent revision of the rules, rather than declaring war on each other.

The WTO cannot pretend to make all countries equal. But the Organization smooths out some rough edges from the point of view of equality, providing smaller countries with greater opportunities to defend their positions, and at the same time, freeing major powers from the need to negotiate trade agreements with each of their numerous trading partners.

Decisions in the WTO are made on the basis of consensus. The WTO agreements were agreed by all members, were adopted by consensus and were ratified by the parliaments of all member States. The agreements apply to everyone. Rich and poor countries have equal opportunities to challenge their right under WTO dispute settlement procedures.

The principle of non-discrimination, prescribed in the WTO agreements, avoids unnecessary complications. The fact that there is a single set of rules applicable to all members greatly simplifies the entire trading regime. And these agreed rules give governments a clear idea of which of the directions of trade policy is the most acceptable.

We are all consumers, and the prices we pay for food and clothing, necessities and luxuries depend on trade policy.

According to available data, consumers and governments of rich countries spend $350 billion a year to support agriculture. This amount is enough to pay for one and a half first-class round-the-world flights for their entire 41 million dairy cows.

Protectionism is expensive: it raises prices. The global WTO system reduces barriers to trade through negotiations, as well as through the application of the principle of non-discrimination. As a result, production costs are reduced (since imports used in production are cheaper), as well as the price of finished products and services, which ultimately reduces the cost of living.

Imagine the whole range of imported goods: fruits and vegetables, food, clothing and other products that were previously considered exotic, fresh flowers from anywhere in the world, all kinds of household goods, books, music, movies and so on.

And now imagine also the goods that people in other countries can receive by exporting them from your and other countries. Import allows us to expand the choice of both goods and services, plus to ensure their higher quality. Even the quality of local goods may improve due to competition from imports.

The concept of a wide choice is not limited only to the question of buying imported finished products. Imports are used as raw materials, components and equipment for industrial production.

It expands the range of end products and services that are produced by domestic manufacturers, and this increases the range of technologies that they can use. For example, when mobile phones appeared, the corresponding services arose even in those countries that do not produce equipment.

Reducing trade barriers allows you to increase trade volumes, which in turn brings additional income, both at the national and individual level. However, some adjustments are needed.

The fact that there is additional income means that Governments have resources to be redistributed.

Economists estimate that reducing trade barriers in agriculture, manufacturing and services by a third will contribute to the growth of the global economy by $ 613 billion.

There is no doubt that trade has the potential to create jobs. In practice, there is often factual evidence that the reduction of trade barriers has a beneficial effect on the employment situation. But the picture is complicated by a number of factors. Plus, the supposedly available alternative - protectionism — is clearly not an adequate solution to employment problems.

This is a complex issue and the approach to its solution should be appropriate. There is strong evidence that trade contributes to economic growth, and that economic growth contributes to the creation of new jobs. It is also true that some jobs will be lost even as trade expands. But thoroughanalysisthis suggests the presence of at least two problems.

Firstly, there are other factors. For example, technological progress also has a powerful impact on employment and productivity, creating some jobs and eliminating others.

Secondly, although trade clearly contributes to the growth of national income (and prosperity), it does not always involve the creation of new jobs, especially for those who have lost their jobs as a result of import competition.

The picture is ambiguous in different countries of the world. The average length of time spent looking for a new job in one country can be much longer than for a similar worker in another country, and under the same conditions.

In other words, some countries adapt better than others. This is partly because some countries have more efficient and flexible political regulators. Those who do not have them lose real opportunities.

Evidence also suggests that protectionism harms employment. For example, in the US automotive industry: trade barriers designed to protect jobs in the US by restricting imports from Japan have eventually made cars more expensive in the US. Accordingly, sales decreased and jobs were lost.

In other words, trying to solve the problem in the short term by restricting trade has turned into a big problem in the long term.

Even when a country is experiencing difficulties during the adjustment period, protectionism as an alternative simply worsens the situation.

Many of the advantages of the trading system are quite difficult to imagine in numbers, but this does not detract from their merits. They follow from the key principles of the system, simplifying life for both entrepreneurs directly involved in trade and producers of goods and services.

Discrimination makes it difficult to trade

Trade allows countries to implement the division of labor, as well as to use production resources more intelligently and efficiently. As for the WTO trading system, it offers even more significant advantages. Thanks to the important principles underlying the system, it helps to further increase efficiency and reduce costs.

The principle of non-discrimination is one of the key principles of the WTO trading system. In addition to it , there are a number of others:

• transparency (policies, norms and rules);
• growing confidence in the terms of trade (commitments to reduce trade barriers and expand access of other countries to their markets have effective legal force);
• simplification and standardization of customs procedures, elimination of bureaucracy, centralized databases, as well as other measures aimed at "trade facilitation".

Together, these factors not only facilitate trade procedures, but also reduce the costs of companies and stimulate a sense of confidence in the future. This, in turn, also means creating more jobs and improving the quality of goods and services.

The GATT-WTO system formed in the second half of the 20th century helps governments to find a more balanced approach in the field of trade policy. Governments have a set of stronger arguments in the fight against lobbyists of all stripes, allowing them to focus on compromises in the interests of all participants in the economic processes in the country.

One of the lessons of the protectionist policy that dominated in the first decades of the 20th century is the damage that was caused as a result of the fact that narrow-industry interests managed to gain an unbalanced share of political influence. This further tightened the restrictive policy, which turned into a trade war that had no winners, but only losers.

At first glance, restricting imports looks like an effective way to support the economic sector. But this means an economic imbalance in relation to other sectors that should not suffer. For example, if you are trying to protect your light industry, then everyone else has to pay for more expensive clothes, and this puts pressure on wages in all sectors.

An escalation of protectionism is possible as other countries respond by raising their trade barriers. This is exactly what happened in the 1920s and 30s, leading to disastrous consequences. In the end, everything turned into losses even for those sectors against which protectionist measures were taken.

Governments should be able to resist the pressure of individual groups lobbying for their narrow interests, and the WTO system can help in this.

The GATT-WTO system covers a wide range of industries. Therefore, if during the GATT-WTO trade negotiations some group actively lobbies its interests, demanding that the government grant them special rights, then the government may reject this, citing the need for a large-scale agreement in the interests of all sectors of the economy. Governments regularly resort to this option.

According to WTO rules, once a commitment to liberalize the trade sector is made, it becomes almost impossible to reverse it. The rules also prevent a number of inappropriate policy decisions from being made. For businesses, this means greater certainty and clarity regarding the terms of trade. For the government, this can often mean an enviable consistency in these matters.

The existence of rules creates effective obstacles to corruption.

The Rules include obligations to prevent inappropriate political decisions from being made. The policy of protectionism, as we have already seen, in general seems to be just such an inadequate option because of the harm it causes both at the national and international levels.

Some of the types of trade barriers introduce an element of additional negativity, since they are associated with unlimited opportunities in terms of rampant corruption and other forms of inefficient management.

One example of this type of trade barriers that the WTO is trying to combat is, for example, a quota limiting the annual minimum or maximum volumes of imports or exports.

By limiting the volume of supplies, quotas artificially raise prices, creating abnormally large profits (economists talk about "quota rent"). This profit, settling in the pockets of lobbyists, can be used to influence the political market.

It can also become a breeding ground for corruption, for example, in the distribution of quotas among traders. There are many examples of this all over the world.

In other words, quotas are an absolutely inadequate tool from the point of view of restricting trade. Governments have agreed under WTO rules that their use should not be encouraged.

Nevertheless, quotas of various types continue to be used in most countries, and governments claim that they simply need them. However, they are under the control of WTO agreements, and there are a number of agreements to reduce or eliminate many of them, in particular, it concerns the textile industry.

WTO agreements deal with a number of other areas, which can also help in the fight against corruption and inefficient management methods.

Transparency (for example, making all information about trade rules available to the public), other aspects of "liberalizing the terms of trade", clearer criteria for rules on product safety and standardization, as well as non-discrimination can help in eliminating "loopholes" for arbitrary decisions and fraud.

Quite often, governments resort to the WTO as one of the options for a positive external constraint on their own policies: "we cannot do this because it violates the WTO agreements."