"Fair Trade for All" by Joseph Stiglitz & Andrew Charlton

Unless you are an economist and, at that, with some specialization in international trade, “Fair Trade for All” is not a project for your summer reading. Joseph Stiglitz (famous Nobel Prize winner) and Andrew Charlton are overwhelming in dealing with the issues of fairness when trade issues are being addressed at WTO meetings.

Per chance that the challenges of reading the book will pass by, the authors stay focused on the need to be fair when addressing trade issues. Essentially, the problems are two-fold: developed countries are strong enough to negotiate unfair agreements that benefit themselves primarily, and secondly, the processes employed in negotiations are not transparent. Again, the processes benefit the developed nations.

While liberalizing trade agreements is generally a positive policy, problems are created when the specific weaknesses of each of the developing countries are not factored into the agreement. Some agreements will benefit certain nations but not others due to the specific differences, e.g., the amount of unemployment. Loss of revenue from the reduction of tariffs impact some nations more than others that have less options for compensating from this reduction.

In addition, there is a need to compensate developing nations for the costs resulting from the need to adjust to the agreements, e.g., infrastructure has to be improved, technical assistance in processing exports/imports.

The bottom line is that negotiating trade agreements through WTO is very, very complex. Unless the strong developed nations have a mind-set to ensure that each of the developing nations will be better off after the agreements are implemented, then one can be assured that the developing nations are being exploited.