Since the beginning of modern history, international trade had played a significant role of shaping countries’ economies. With international trade, countries can specialize on certain products to produce the best and trade other necessities from other nations through international trade. Although on the surface international trade is a key factor that holds all nations together and achieve globalization, some people critic international trade as a tool of the rich countries to exploit poor countries. Furthermore, some people believe that international trade regimes are based on dominance; however, other people believe that it is based on reciprocity. This post is going to argue that international trade is based more on dominance, which the richer country dominates the poor country, than reciprocity, which both rich and poor countries agree on certain terms on global trade.
Since World War II ended, the western economic powers established many organizations such as the International Monetary Fund, World Bank, and the World Trade Organization to regulate and monitor the international trade system. The first intention to establish these organizations was to aid poor countries and help them to build basic infrastructures and reduce tariffs to increase the amount of international trade. However, due to the fact that the rich countries dominate these trade organizations to control the economies of the poor countries, the international trade between the rich and poor is based on dominance more than reciprocity. For example, in the documentary “Black Gold”, the Ethiopian coffee farmers cannot gain the wealth they deserve. Instead, the rich countries such as the US and UK, and other large economic co-operations such as Starbucks exploit these Ethiopian coffee farmers and buy their coffee at the cheapest price. In addition, the IMF also plays an important role to help the rich countries to exploit these poor farmers. For instance, the IMF asks Ethiopia to reduce its fund on education and health care and to improve its economy. Yet, with the reduction of aid on education and health care, many Ethiopians cannot receive proper care and the country’s people will continuously remain poor due to the lack of education and high poverty rate. Therefore, in international trade regimes, dominance occurs more often than reciprocity with the rich countries trade with the poor countries and use organizations such as the IMF, World Bank, and WTO to force poor countries to obey their trading rules.
Besides the implementation of the trade organizations, the international trade system is also greatly affected by the colonial period. When the western economic powers, which were once colonial powers, established colonies in the developing world, which are now the poor countries, they did not consider the country’s future economy. The colonial powers only allow the colonies to produce limited amount of crash crops and sell them to the world. The colonial powers gain lots of wealth from these crash crops, yet does not realize that it results a dependency of crash crops in these colonies. After decolonization, former colonies still remain relying on limited number of products and do not have a chance to change its shaped economy. Therefore the former colonial powers, now the rich countries, basically forced the colonies, now poor countries, to remain poor and shaped their economy for them during the colonial period. Therefore, we can conclude that the international trade regimes are based more on dominance than reciprocity.
In conclusion, international trade is based more on dominance, which the richer country dominates the poor country, than reciprocity, which both rich and poor countries agree on certain terms on global trade, because the rich countries dominate the trade organizations to achieve their goals to exploit the poor countries and the colonial economic consequences that the colonial powers had done to the colonies in the past.
Since World War II ended, the western economic powers established many organizations such as the International Monetary Fund, World Bank, and the World Trade Organization to regulate and monitor the international trade system. The first intention to establish these organizations was to aid poor countries and help them to build basic infrastructures and reduce tariffs to increase the amount of international trade. However, due to the fact that the rich countries dominate these trade organizations to control the economies of the poor countries, the international trade between the rich and poor is based on dominance more than reciprocity. For example, in the documentary “Black Gold”, the Ethiopian coffee farmers cannot gain the wealth they deserve. Instead, the rich countries such as the US and UK, and other large economic co-operations such as Starbucks exploit these Ethiopian coffee farmers and buy their coffee at the cheapest price. In addition, the IMF also plays an important role to help the rich countries to exploit these poor farmers. For instance, the IMF asks Ethiopia to reduce its fund on education and health care and to improve its economy. Yet, with the reduction of aid on education and health care, many Ethiopians cannot receive proper care and the country’s people will continuously remain poor due to the lack of education and high poverty rate. Therefore, in international trade regimes, dominance occurs more often than reciprocity with the rich countries trade with the poor countries and use organizations such as the IMF, World Bank, and WTO to force poor countries to obey their trading rules.
Besides the implementation of the trade organizations, the international trade system is also greatly affected by the colonial period. When the western economic powers, which were once colonial powers, established colonies in the developing world, which are now the poor countries, they did not consider the country’s future economy. The colonial powers only allow the colonies to produce limited amount of crash crops and sell them to the world. The colonial powers gain lots of wealth from these crash crops, yet does not realize that it results a dependency of crash crops in these colonies. After decolonization, former colonies still remain relying on limited number of products and do not have a chance to change its shaped economy. Therefore the former colonial powers, now the rich countries, basically forced the colonies, now poor countries, to remain poor and shaped their economy for them during the colonial period. Therefore, we can conclude that the international trade regimes are based more on dominance than reciprocity.
In conclusion, international trade is based more on dominance, which the richer country dominates the poor country, than reciprocity, which both rich and poor countries agree on certain terms on global trade, because the rich countries dominate the trade organizations to achieve their goals to exploit the poor countries and the colonial economic consequences that the colonial powers had done to the colonies in the past.