DEPARTMENT OF BUSINESS ADMINISTRATION-BBA (GENERAL)
COURSE CODE: BBA 6.3
NAME OF THE COURSE: INTERNATIONAL BUSINESS
SEMESTER & SECTION:6TH SEM B & D
PREPARED BY : Prof. Sumalatha N
MODULE : 4: Organizations Supporting International Business
International Monetary Fund (IMF)
World Trade Organization (WTO)
General Agreement on Tariffs and Trade (GATT)
General Agreement on Trade in Services (GATS)
Trade-Related Investment Measures (TRIMs)
Trade-Related Aspects of Intellectual Property Rights (TRIPS)
Regional Integration Groups
European Union (EU)
North American Free Trade Agreement (NAFTA) (Now replaced by USMCA)
South Asian Association for Regional Cooperation (SAARC)
Brazil, Russia, India, China, and South Africa (BRICS)
International Monetary Fund (IMF)
Meaning:
The International Monetary Fund (IMF) is an international financial institution
that aims to foster global monetary cooperation, secure financial stability,
facilitate international trade, promote high employment and sustainable
economic growth, and reduce poverty around the world.
The IMF has 190 member countries. Notable exceptions include North Korea,
Cuba, and a few small states.
Objectives:
1. Promote international monetary cooperation.
2. Facilitate the expansion and balanced growth of international trade.
3. Promote exchange stability and orderly exchange arrangements.
4. Assist in the establishment of a multilateral system of payments.
5. Provide resources to member countries in need of financial assistance.
Functions:
1. Surveillance: Monitoring the economic and financial developments of its
member countries.
2. Financial Assistance: Providing loans to member countries facing balance
of payments problems.
3. Technical Assistance and Training: Offering expertise and training to
member countries to help improve their economic management.
World Trade Organization (WTO)
Meaning:
The World Trade Organization (WTO) is an international organization that
regulates international trade. It provides a framework for negotiating trade
agreements and a dispute resolution process aimed at enforcing
participants' adherence to WTO agreements.
The WTO has 164 member countries. Some prominent non-members include
Iran, Algeria, and Belarus.
Objectives:
1. Promote fair and free trade by reducing trade barriers.
2. Ensure that trade flows as smoothly, predictably, and freely as possible.
3. Provide a platform for trade negotiations.
4. Settle trade disputes between members.
5. Monitor national trade policies.
Functions:
1. Administering WTO trade agreements.
2. Providing a forum for trade negotiations.
3. Handling trade disputes.
4. Monitoring national trade policies.
5. Providing technical assistance and training for developing countries.
General Agreement on Tariffs and Trade (GATT)
Meaning: The General Agreement on Tariffs and Trade (GATT) was a legal
agreement aimed at promoting international trade by reducing or eliminating
trade barriers such as tariffs or quotas. It was succeeded by the WTO in 1995.
The GATT, which was replaced by the WTO in 1995, originally had 23
contracting parties when it was signed in 1947. By the time it was replaced by
the WTO, it had 128 contracting parties.
Objectives:
1. Promote international trade by reducing trade barriers.
2. Ensure fair competition.
3. Encourage economic growth and development.
Functions:
1. Providing a framework for negotiating trade agreements.
2. Monitoring the implementation of trade agreements.
3. Facilitating the resolution of trade disputes.
General Agreement on Trade in Services (GATS)
Meaning:
The General Agreement on Trade in Services (GATS) is a treaty of the WTO
that extends the multilateral trading system to the service sector, in the same
way, the GATT provides such a system for merchandise trade.
GATS is a treaty within the WTO framework. Therefore, its members are the
same as the WTO, comprising 164 countries.
Objectives:
1. Create a credible and reliable system of international trade rules for
services.
2. Ensure fair and equitable treatment of all participants.
3. Stimulate economic activity through increased trade and investment in
services.
4. Promote progressive liberalization of trade in services.
Functions:
1. Providing a framework for the negotiation of services agreements.
2. Facilitating the implementation of commitments made by member
countries.
3. Promoting transparency in regulations affecting trade in services.
Trade-Related Investment Measures (TRIMs)
Meaning:
Trade-Related Investment Measures (TRIMs) are rules that apply to the
domestic regulations a country applies to foreign investors, often as part of an
industrial policy. These measures are covered under the WTO agreement.
TRIMs is part of the WTO agreements, so the member countries are the same
164 WTO members.
Objectives:
1. Eliminate investment measures that restrict and distort trade.
2. Promote the free flow of international investment.
3. Ensure non-discrimination and transparency in investment measures.
Functions:
1. Prohibiting performance requirements related to trade and investment that
are inconsistent with the WTO.
2. Providing a framework for monitoring compliance with TRIMs
obligations.
Trade-Related Aspects of Intellectual Property Rights (TRIPS)
Meaning:
The Trade-Related Aspects of Intellectual Property Rights (TRIPS) is an
international agreement administered by the WTO that sets down minimum
standards for many forms of intellectual property regulation as applied to
nationals of other WTO members.
TRIPS is also part of the WTO agreements, so it includes the same 164 WTO
members.
Objectives:
1. Establish a comprehensive and balanced intellectual property system.
2. Promote effective and adequate protection of intellectual property rights.
3. Ensure that intellectual property rights do not themselves become barriers
to legitimate trade.
Functions:
1. Setting minimum standards for the protection of intellectual property.
2. Providing a framework for the enforcement of intellectual property rights.
3. Facilitating the resolution of disputes over intellectual property issues.
Regional Integration
European Union (EU)
Meaning:
The European Union (EU) is a political and economic union of 27 member
states that are located primarily in Europe, aiming to foster economic
cooperation and ensure peace and stability.
The EU currently has 27 member countries:
1. Austria
2. Belgium
3. Bulgaria
4. Croatia
5. Cyprus
6. Czech Republic
7. Denmark
8. Estonia
9. Finland
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Objectives:
1. Promote economic and social progress.
2. Establish a single market.
3. Promote peace and stability.
4. Foster social integration and cohesion.
5. Establish a common currency (Eurozone).
Functions:
1. Legislating on common policies (e.g., trade, agriculture, fisheries, and
regional development).
2. Implementing and enforcing laws through EU institutions.
3. Managing common budgets and funding programs.
4. Representing the EU in international forums.
North American Free Trade Agreement (NAFTA)
Meaning:
The North American Free Trade Agreement (NAFTA) was an agreement
among the United States, Canada, and Mexico designed to remove tariff barriers
between the three countries. It has been replaced by the United States-Mexico-
Canada Agreement (USMCA).
NAFTA had 3 member countries:
1. Canada
2. Mexico
3. United States
These three countries are now members of the United States-Mexico-Canada
Agreement (USMCA), which replaced NAFTA.
Objectives:
1. Eliminate trade barriers between the US, Canada, and Mexico.
2. Increase investment opportunities.
3. Promote fair competition in the free trade area.
Functions:
1. Removing tariffs and trade barriers.
2. Establishing mechanisms for dispute resolution.
3. Enhancing cross-border trade and investment.
South Asian Association for Regional Cooperation (SAARC)
Meaning:
The South Asian Association for Regional Cooperation (SAARC) is an
organization of South Asian nations, established to promote economic and
regional integration.
SAARC has 8 member countries:
1. Afghanistan
2. Bangladesh
3. Bhutan
4. India
5. Maldives
6. Nepal
7. Pakistan
8. Sri Lanka
Objectives:
1. Promote the welfare of the peoples of South Asia.
2. Accelerate economic growth, social progress, and cultural development.
3. Strengthen collective self-reliance among South Asian countries.
Functions:
1. Facilitating economic cooperation and development projects.
2. Promoting regional trade and investment.
3. Addressing social issues such as poverty, education, and health.
BRICS
Meaning:
BRICS is an acronym for five major emerging economies: Brazil, Russia, India,
China, and South Africa. The group aims to promote peace, security, and
development in their respective regions and globally.
BRICS consists of 5 member countries:
1. Brazil
2. Russia
3. India
4. China
5. South Africa
These lists are current as of the latest available information and may change as
countries join or leave these organizations or agreements.
Objectives:
1. Promote mutual economic growth and development.
2. Strengthen financial cooperation.
3. Enhance collaboration in various sectors, including infrastructure,
technology, and trade.
Functions:
1. Holding annual summits to discuss and coordinate policies.
2. Establishing financial institutions like the New Development Bank.
3. Promoting cultural and people-to-people exchanges.
Each of these organizations and agreements plays a significant role in shaping
international trade, economic policies, and regional cooperation.