SEMESTER SPRING 2013

INTERNATIONAL BUSINESS (MGT520)
ASSIGNMENT NO. 01
DUE DATE: 2ND MAY 2013
MARKS: 20
ASSIGNMENT:
TOPIC: WTO rules and its impact on developing countries
Learning objectives
 To get an overview of how rules of WTO affect business process of
developing countries.
 To get an insight of WTO sub rules designed for the agriculture
segment of developing countries.
 To find the importance of local infrastructure, rules and policy in
compliance with WTO.
Learning outcomes
After this assignment, student will:
 Get a familiarity with WTO’s sub rules and their possible benefits for
developing countries.
 Learn that how we can utilize our competitive advantage to get
maximum benefits at international level in the presence of
international regulations.
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Background:
As this is an era of globalization and international business requires
removing barriers, restrictions and ensuring safety in business activities
while trading goods, services, technology, and sharing investments among
different countries. World Trade Organization (WTO) which is an updated
form of General Agreement on Tariffs and Trade (GATT) is formed in
1990’s after successive rounds of negotiations and legislations. WTO is
considered as the principal international institution, responsible for laying
down rules for the smooth conduct of trade in goods and services among
nations.
Real time scenario:
Critics say that there are some grey areas in WTO which provide more space
and opportunities for developed countries as compared to developing
countries; as a result they are getting more benefits as compared to
developing countries in all forms of trade. In world’s economy agriculture is
placed as a pillar. It contributes a larger amount of exports and provides
employment to the skilled and unskilled labor in the developing countries.
Agriculture related issues have been addressed in the following sub
agreements by WTO.
1. Agreement on Agriculture (AOA): It covers the issues of domestic
support, market access and export competition.
2. Agreement on Application of Sanitary and Phyto-sanitary Standards
(SPS): It deals with Health and disease related issues
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3. Agreement on Technical Barriers to Trade (TBT): It deals with
standards, certification procedures which include packaging, marking and
labeling requirements.
4. Agreement on Trade Related Aspects of Intellectual Property Rights
(TRIPs): IT deals with Patents and copyrights, plant breeders’ rights.
The overall result of agricultural liberalization and implementation of the
Agreement on Agriculture (AOA) along with other sub agreements
mentioned above is not positive. As
• There has been a tendency in the developed countries to erect nontariff
trade barriers against the products of developing countries.
• Developing countries exports suffer due to low profit margins and
price fluctuations in international markets.
• Greater proportion of the agricultural land and farms leads to
increased productivity which increases the local competition, unemployment
and poverty.
• Prices of food items are kept artificially low to cater to the needs of
low paid urban labor and middle class people.
• They face tough resistance to reach the markets of developed
countries on the basis of food, human safety, animal, and plant health and
safety standards.
• Developing countries fear that their centuries old farm practices will
become dependent on multinationals. This issue rises due to intellectual
property rights for seeds and plant varieties. Multinational seed companies
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have now started claiming patent rights over the seed produced through their
research by introducing some new gene sequence.
Pakistan is an agrarian country and facing the same sort of issues like many
other developing countries. Statistics show that in spite of having a potential
comparative advantage over developed countries in the production of many
agricultural and food products such as cotton, rice, fruits, flowers, meat and
other dairy products, Pakistan has not been able to get the maximum benefits
from the recent developments and legislations occurred at WTO.
Requirement:
How Pakistan can get the optimum benefits (exports with improved
profit margins, readily acceptance of products at international level by
value addition and balanced imports from developed countries) by
proving itself a dedicated member of WTO and mending its
infrastructure (local resource, standards, country laws and economic
policies).
Note:
A WTO rules are hardly negotiable here; provide your answer in context to
local infrastructure which gives an idea to capitalize the competitive edge we
have. For the complete information about Pakistan’s agriculture statistics
(local production of crops, imports and exports) and WTO’s sub agreements
(AOA, SPS, TBT, TRIPS) you can visit the following websites.
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en.wikipedia.org/wiki/Agriculture_in_Pakistan
IMPORTANT:
24 hours extra / grace period after the due date is usually available to overcome
uploading difficulties. This extra time should only be used to meet the
emergencies and above mentioned due dates should always be treated as final
to avoid any inconvenience.
IMPORTANT INSTRUCTIONS/ SOLUTION GUIDELINES/ SPECIAL
INSTRUCTIONS
OTHER IMPORTANT INSTRUCTIONS:
DEADLINE:
 Make sure to upload the solution file before the due date on VULMS.
 Any submission made via email after the due date will not be accepted.
FORMATTING GUIDELINES:
 Use the font style “Times New Roman” or “Arial” and font size “12”.
 It is advised to compose your document in MS-Word format.
 You may also compose your assignment in Open Office format.
 Use black and blue font colors only.
REFERENCING GUIDELINES:
 Use APA style for referencing and citation. For guidance search “APA
reference style” in Google and read various website containing
information for better understanding or visit
Only the registered members can see the link. Registerhere
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RULES FOR MARKING
Please note that your assignment will not be graded or graded as Zero (0), if:
 It is submitted after the due date.
 The file you uploaded does not open or is corrupt.
 It is in any format other than MS-Word or Open Office; e.g. Excel,
PowerPoint, PDF etc.
 It is cheated or copied from other students, internet, books, journals etc.
Note related to load shedding: Please be proactive
Dear students!
As you know that Pre Mid‐Term semester activities have been
started and load shedding problem is also prevailing in our
country now a days. Keeping in view the fact, you all are advised
to post your activities as early as possible without waiting for the
due date. For your convenience; activity schedule has already
been uploaded on VULMS for the current semester, therefore no
excuse will be entertained after due date of assignments, quizzes
or GDBs.