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8 Ways World Trade Organization Membership Will Benet

Afghanistan (http://blog.chemonics.com/8-ways-worldtrade-organization-membership-will-benet-afghanistan)
Posted on February 3, 2016 by Madeleine Dale (http://blog.chemonics.com/madeleine-dale)

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December 17, 2015, marked a monumental moment

(http://www.chemonics.com/OurImpact/SharingImpact/ImpactStories/Pages/A-New-Trade-Horizon-forAfghanistan.aspx) for Afghanistan. After 11 years of negotiations, The World Trade Organization (WTO)
formally adopted Afghanistans terms of accession at its 10th Ministerial Conference in Nairobi, Kenya. What
does this mean for Afghanistans future? Here are eight reasons why WTO membership will benet
Afghanistan.
1. Economic growth, investment, and job creation
Afghanistans export structure is dominated by agricultural
products and some manufacturing of goods, such as textiles
and carpets. As a WTO member, Afghanistan will benet from
access to new markets, global supply chains, and lower tariffs,
ultimately creating a better and more competitive job market
in which more Afghans can earn better wages.
2. More support for local industry
WTO membership will provide access to international markets and commodities, allowing Afghan
businesses to purchase inputs at a lower price and enabling industry to produce goods more
competitively. Membership will also give rise to both export and competition, which will support quality
improvement and standardization to exports. Imports will be used as materials, components, and
equipment for local production. Trade will allow Afghanistan to import more and will also allow the
world to buy more of Afghanistans exports.
3. Wider choice of lower-cost products for consumers
Afghans will be able to buy fruits and vegetables out of
season, a variety of products that used to be considered
exotic, and all kinds of household goods, books, music, and
movies from across the globe. More choice will allow
consumers to buy domestic and foreign nished products
more inexpensively. This will reduce the costs of production
(because raw imports used in production are cheaper) along
with the prices of nished goods and services.
4. Fair playing eld with WTO members
Decisions in the WTO are made by consensus. The WTO agreements are negotiated by all members,
approved by consensus, and ratied in all members parliaments. The agreements apply to everyone.
There is a single set of rules that applies to all members which simplies the entire trade regime and
gives governments a clear view of which trade policies are acceptable. Rich and poor countries alike
have an equal right to challenge each other in the WTOs dispute settlement procedures. Afghanistan
will benet from increased bargaining power and the opportunity to form alliances with larger
economic powers and to pool resources.
5. Protection from regional trading powers
Members bring their disputes to the WTO and do not act unilaterally. Dispute Settlement
Understanding (DSU), considered the backbone of dispute settlement under the WTO, allows all
members to be treated according to a rule-based system and ensures their trade rights under

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international trade are fairly secured during dispute

settlement. Article 24 of DSU requires members to give
particular consideration to the situations of least developed
countries, which Afghanistan will benet from immensely.
6. Path toward better government
WTO rules commit member nations to a more liberalized
economy and vibrant trade sector that is difcult to reverse.
WTO rules, as well as reduced tariffs and non-tariff barriers,
also discourage a range of unwise policies and helps reduce corruption. For example, transparency,
clear regulations for product safety and standards, and non-discrimination prevent cheating and
arbitrary decision-making.
7. Access to WTO grants and capacity building initiatives
As a least-developed country, Afghanistan will be entitled to
the preferential treatment from WTO members under the
special and differential treatment provisions enshrined within
the WTO agreements. Provisions can include awarding longer
time for implementing agreements and commitments,
increased trade opportunities, protection of trade interests by
other members, or capacity building in the handling of
disputes and implementation of technical standards.
Afghanistan can also request direct technical assistance from the WTO to improve national capacity
for trade, policy-making, and dispute resolution.
8. Peace through trade
Last but certainly not least, trade brings prosperity, and prosperous people are less likely to cause or
revert to conict. If trade ows freely and healthy commercial relationships are formed, political
conict becomes less likely between nations. With its agreement by consensus and strong focus on
abiding by the rules, the WTO is a critical trust builder. Members do not need to fear that other
members will raise trade barriers and are in a better frame of mind to cooperate.
Afghanistan remains a land locked, war-torn, and aid dependent economy that suffers from political
inghting and a deteriorating security situation. However, progression on trade reform is a stepping stone
toward improving the lives of the Afghan people both politically and economically. A vibrant and freer trade
environment can help Afghan businesses bounce back and interact in the global economy.
As Afghan President Ashraf Ghani said, "Our country's accession to the WTO will serve as a catalyst for
domestic reforms and transformation to an effective and functioning market economy that attracts
investment, creates jobs and improves the welfare of the people of Afghanistan.

Madeleine Dale is a manager in Chemonics' Afghanistan Division. Learn more

(http://www.chemonics.com/OurImpact/SharingImpact/ImpactStories/Pages/A-New-Trade-Horizon-forAfghanistan.aspx)about USAID's and Chemonics' role in preparing Afghanistan for World Trade Oragnization
accession.

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