Global governance and its impact on World Trade

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Globalgovernance and its impact on World Trade

Globalgovernance is the most significant undertaking towards politicalcollaboration that addresses, mediates and provides leadership toissues that affect member states and has huge impacts on world trade.In the last few decades, various communities in the world have becomeincreasingly interconnected due to economic integration andincreasing change in technology (Ikenberry, 2015). Global governanceconstitutes organizing, administering and supervision of globalaffairs and processes without a prescribed world government.Correspondingly, it offers real and accommodative problem-solvingengagements in social, environment, economic and political issues(Iorio, 2014). There are various entities within the globalgovernance where a particular entity deals with the specific subject.For instance, world trade organization deals with regulations ofmatters regarding trade among the member countries and regional tradeblocks. Global governance has a great impact in the process ofregulating global trade that may not have been achieved without theseeffective institutions (Lambek et al., 2013). This research seeks toeermine global governance, its impact on world trade and challengesfacing global governance in its quest to agitate for free trade amongcountries throughout the globe.


Globalgovernance entails undertaking towards political collaboration and asystem of the team working with international players that are aimedat negotiating and reacting to issues that affect states and regions(Lechner &amp Boli, 2015). Various institutions involved in globalgovernance include United Nations, World Bank, the internationalcourt that prosecutes criminals, IMF among others. Theseorganizations have a great role in guiding and influencing cultures,economy, politics, environmental issues and other spheres of humaninterest (Ikenberry, 2015). Governance bodies had a positive impacton trading designating laws and regulations that guide trade andother forms of interaction between people. Such laws are valuable inregulation, decision making and handling of administrative issuesthat face the globe.

Besides,the governance bodies are interested in coordinating specificmechanisms regarding accountability, legitimacy, and transparency(Jackson, 2008). Consequently, they emphasize on transparency,bureaucratic participation, reasoned decisions, and accessibility toassessment mechanisms. Besides, they focus on circumvention ofunnecessary measures and illegitimate avoidance expectations (Busch &ampReinhardt, 2003). Global governance is made up of an incongruentassortment of regulatory entities that facilitate decision making andadministrative activities facing member states. Such bodies includeBasel Committee that regulate and supervise banking sector through ofthe territories of the member states. This committee liaises betweengovernments of the member countries, the secretariat of the globalgovernance entities and the banks.

Globalgoverning bodies develop laws that monitor the operations of tradinginternational regulatory entities like world trade organization tohelp in enhancing transparency and accountability (Weiss &ampKammel, 2015). This activity has huge impacts on operations of freetrade and ensures that each member transacts freely, fairly andperforms the legitimate trade. Besides, the institution ensures thatfairness, due process, and procedural participation been adheredaccordingly. Without due process, the legal system will lacklegitimacy and efficacy. Fairness is significant because it allowsparticipating members rights to acquire an arbitrator. A principle ofjustice also involves appropriate judicial and administrativeproceedings. The developed principles of fairness, transparency anddue process are incorporated into World Trade Organization (WTO)agreements to ensure that parties involved in making agreements orare in disputes arrive at a fair settlement.

Theinterpretation and implementation of WTO agreements employ theadministrative laws developed by global governance and incorporatedin the legislation of the World Trade Organization (Lechner &ampBoli, 2015). The principle of due process is fundamental in thecourse of ensuring justice prevails between members states who maydevelop disagreements. Due process involves three major items thatinclude natural justice, fundamental fairness, and proceduralfairness. Due process is applied in world trade organization disputesthrough both “bottom up” and “top down” approaches (Bradford,2005). Moreover, various integral concepts of global executive lawshave also been derived from World trade organizations. As such, WTOand global governance entities supplement each other’s efforts inthe process of administering justice to the member countries.

Globalgovernance liaises with world trade organization to negotiate theremoval of trade barriers such as protectionism (Weiss &amp Kammel,2015). This initiative has had massive impacts on world trade becauseit has led to uniformity in economic growth and competition whichenhance innovation. Protectionism entails and economic strategyclosely affiliated to anti-globalization that seeks to restrain tradeamong countries through activities such as trade limits and theimposition of heavy tariffs on imported goods. Consequently, globalgovernance has had a significant impact on a trade by creating forumsthat lead to negotiations to repeal such government regulations andother restrictive measures (Lambek et al., 2013). Althoughprotectionism may be beneficial regarding protecting localindustrial, creating employment and preventing competition, ithinders international trade thereby inhibiting free trade resultingto diminished regional growth (Ikenberry, 2015). Accordingly,anti-protectionism argues that it has a hugely detrimental effect andharmful effect on the people. As such world trade organization seeksto come up with the trading model where free trade exists amongmember countries in that enterprises will be free to trade andcompete with other players in the globe (Weiss &amp Kammel, 2015).

Thegoverning bodies are instrumental in building consensus that generateagreements and guidelines on ways in which trade between or amongparties should be operated. This initiative has an impact on theoutcome of the ongoing negotiation. Moreover, the institutions builda relationship based on mutual respect and ensure that therelationship is sustained in the throughout the process trading.Obligations, duties, and privileges cannot be established during anytrading exercise without neutral institutions accredited by variousnations (Busch &amp Reinhardt, 2003). Various trade agreements arealso negotiated by established professional with knowledge ininternational matters and relations to establish the best ways inwhich the trade should be conducted. The overall internationalorganizations like United Nations facilitate world trade organization(WHO) to take the lead role in handling trade issues. The governingbodies are also instrumental in dealing with conflicting issues intrade and devising ways of advancing peaceful settlement to avoid thechallenges from spilling over into other areas such as politics(Jackson, 2008).

Arbitrationis one of the legitimate objectives that world governance bodiesoffer to member countries whose impact in trade is revolutionary.Although these institutions have limited scope of acting, they aresymbolically powerful, and thus their views carry more weight becausethey are taken as conventional views of the majority. The institutionbrings about accountability in that the members of diverse tradingblocks and international agencies are responsible for all manners oftrade operations that they undertake (Struye &amp Vandamme, 2015).For instance, United Nations brings together agencies from diverseinstitutions, civil societies, and labor organizations. These bodiesare entrusted with the responsibilities of conducting checks andenacting the right interventions to ensure that transactions arebeing carried out appropriately. They also ensure that the tradingactivities do not abstract the internationally established rules intrade. For instance, the agencies and accredited civil society groupsensure that illicit trade does not proliferate to avoid internationalconflicts and damage to business.

Besides,the institutions entrusted with these duties ensure that the tradingactivities are carried out in a sustainable manner (Weiss &ampKammel, 2015). This ingenuity has a progressive and constructiveimpact on world trade because it brings about endurance anddurability to trade. Trading blocks and individual nations adhere tothe rules partly because they are monitored and also because therules make senses to all the stakeholders. The institutions ofgovernance develop platforms and establish forums where trade pactsare negotiated, and meaningful dialogue is held with the intention ofharmonizing the legal issues that arise during trading (Lechner &ampBoli, 2015). The international bodies responsible for governingissues are continually neutral in handling all matters pertainingtrade. Accordingly, order, duties, and rights applicable to theestablished laws of the international governing bodies areestablished. The governing institutions also institute necessaryconditions for sustainable and supportable development, reduceinequalities and create a permanent peace during interactions(Bradford, 2005).

Thegovernance established bodies such as WHO open novel markets andintegrate trading arrangements between parties. This inventivenesshas had a great impact in enhancing trading activities betweenparties and thus building on a lucrative venture where huge profitshave been obtained. Moreover, various goods that are produced indifferent regions of the world can reach different individual thatmay not have achieved them without sufficient internationalintegration (Jackson, 2008). In addition to solving disputes andapplying legal pressure to party members, the governing bodiesnegotiate other agreements such as environmental and energysustainability. Efficient trade may not be achieved without adherenceto the established sustainability rules such as a rule governingpollution and environmental degradation (Ikenberry, 2015). Theinstitutions of governance have been instrumental in advancingsecurity, peace and conflict resolution especially in areas in whichthere is no respect for civil rights. For instance, global terrorismand other world conflicts have led to social conflict, economicinequality, and religious sectarianism among other imbalances (Struye&amp Vandamme, 2015). Efficient trade does not prevail withproliferations of these conflicts, and thus global governance hasbeen instrumental and impactful in establishing the cause and workingto develop solutions to these conflicts.

Globalgovernance played a great role in the formation of world tradeorganization (WTO). This revolutionary achievement has affirmativeimpacts to global trade in an imaginable level. Traditionally, globalgovernance dedicated their effort in the management of world affairsthrough informal and formal interactions amidst states (Weiss &ampKammel, 2015). Environmental, social-economic, as well as technologyimprovements, encouraged intensified interactions among private,public, international and domestic affairs. World trade organizationencompasses diverse member states that join to manage, promote andregulate free trade. It is currently made up of one hundred andsixty-four members who control 97% of the entire trading transactionin the world (Christiansen &amp Neuhold, 2012). The organizationadministers the implementation of international trade rules, and itsactivities are monitored, regulated and enforced by global governancesystem. The Global governing ensures that WTO enforces, administers,guide decision making and manage of various trading responsibilitiesappropriately (Bradford, 2005). Global governance has had asignificant impact on the development of centralization of theprocess of interaction among states. This provision is made by theprovision of a neutral forum for discussing specific issues regardingtrade and depoliticizing matters that could trigger moredisagreements among different countries.

Thegovernance system has had an enormous impact on the proliferation ofequitable trade operations by balancing the relationship betweenweaker and stronger countries (Weiss &amp Kammel, 2015). Theargument is that balanced relations would be impartial, neutral andindependence. Impartiality is significant in that there is nofavoritism during mediation while neutrality demonstrates the factthat the governing organization can be trusted mediators.Independence is important because international governanceorganizations have the ability to make individual decisions withoutinterference from outside quarters. Global governance maximizestrade, increases development opportunities and promotes investment inthe development countries (Lechner &amp Boli, 2015). This approachis derived from the fact that global governing organization sticks totheir primary objective of equitable and inclusive trade.

Theglobal governance promotes dialogue with the intention ofharmonization and simplification of customs procedures through worldtrade organization. This inventiveness has a progressive andground-breaking impact to trade because of transparency and enablesaccumulation of enormous wealth in member countries. Correspondingly,the initiative facilitates compliance, strengthens revenue collectingexercises and promoted democracy (Busch &amp Reinhardt, 2003). Thisingenuity allows all member countries especially the weaker countriesto contribute to the decision-making process. Any member countriescan defend their rights, negotiate an agreement and resolve theirconflict with without any hindrance. Governing and regulatory rulesdictates that efficient mechanism of resolving conflict should beadhered (Ikenberry, 2015). World trade organization is also equippedwith a perfect tool to ensure that trading activities are effectivelycoordinated and synchronized. The privileged trade agreements arecarefully screened and harmonized to match the needs of growing worldregionalization. Global governance has also ensured that emergingeconomies are integrated to facilitate free trade and expandopportunities and ideas in the Secretariat (Lechner &amp Boli,2015). The reason is that more diverse community of nations will beable to work as a team, widen the scope regarding monetary regulationand hinder future economic downtown.

Challengesfacing global organization in managing trade activities include thefact that there have been issues regarding the accountability andlegitimacy (Weiss &amp Kammel, 2015). These issues have extended tothe level of world trade organization thus has negative impacts ontrading activities. The governing bodies lack inclusiveness in thatmost of the nations are not represented as major players in thecouncil. There is an increasing need for adjustment so that globalgovernance bodies will reflect the contemporary changes that havealready taken place (Christiansen &amp Neuhold, 2012). Lack ofinclusiveness in the governance of the global bodies is replicated inthe world trade organization and other regional bodies dealing withtrade. As such, the process of transparency, due process and fairnessare impaired thereby leading to compromised in trading activities.Correspondingly, the unipolar nature of the media, military, economyand political facets leads to biases in decision making andinterference in other nations’ foreign policy (Iorio, 2014).Interference sometimes leads to sanctions and trading restrictionswhich may result in international conflict.

Moreover,there is a lack of experts who can mediate in case conflicting issuesarise and find a common approach to a disagreement that sometimesresults in isolation and interconnectedness. Such issues infiltrateinto to the trading blocks and other bodies bestowed with theresponsibilities of overseeing trade activities thus leadingdisintegration (Bradford, 2005). Disagreements impair internationaltrade leading to detrimental consequences to member countries. Global governance has also been faced with the challenge ofliberalization and superficial supervision of international trade byfailing to provide a suitable framework in which negotiation can beformalized especially on issues regarding trade agreements (Busch &ampReinhardt, 2003). Consequently, such challenge has led toinconsistency in enforcing trade policies such as tariffs as welllack of lack of uniforms approaches in handling different tradeconflicts. Besides, there is the feeling that internationalorganizations have overemphasized more on trade and other activitiesat the expense of values. Consequently, the internationalorganization organizations that govern trade and other affairs shouldgo beyond trade to other activities such as health, environment andintellectual property (Lechner &amp Boli, 2015). At the same time,global governance bodies fail to uphold the aspirations of the memberstates and thus end up enacting different plans which in most casesskewed.


Globalgovernance plays a significant role in providing leadership tovarious issues that affect member countries. It also offers concreteand accommodative problem-solving engagements in social, environment,economic and political affairs. Institutions involved in globalgovernance include United Nations, World Bank, IMF among others.Global governance has been impactful in world trade in many ways.Some of these ways include regulating and supporting entities such asWorld trade organizations that deal with matters regarding trade.This activity has huge impacts on operations of free trade andensures that each member with accountability, transact freely, fairlyand perform the legitimate trade. Global governance liaises withworld trade organization to negotiate the removal of trade barrierssuch as protectionism. This revolutionary initiative has had massiveimpacts on world trade because it has led to uniformity in economicgrowth and competition which enhance innovation. However, Globalgovernance faces some challenges in the process of regulating worldtrade. These include lack of transparency, accountability andlegitimacy, liberalization and superficial supervision and Lack ofinclusiveness in the governance.


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