INTERNATIONAL BUSINESSs

Name SIDRA IFTIKHAR

SECTION: Ah

REGISTERATION NO :078
Submitted to sir saqib fareed sheikh

GLOBALIZATION
Globalization is the process of international integration arising from the interchange of world views, products, ideas, and other aspects of culture. In particular, advances in transportation and telecommunications infrastructure, including the rise of the Internet, are major factors in globalization and precipitate further interdependence of economic and cultural activities.
GATT
General agreement on tariffs and trade, an international treaty (1948–94) to promote trade and economic development by reducing tariffs and other restrictions. it was superseded by the establishment of the world trade organization in 1995
History of GATT
• Following World War II, the victor nations sought to create institutions that would eliminate the causes of war.
• Their principles were to resolve or prevent war through the United Nations and to eliminate the economic causes of war by establishing three international economic institutions.
GATT, 1947
Because the ITO was stillborn the provisional agreement for the ITO, the General Agreement on
Tariffs and Trade (GATT) became the agreement and the organization for establishing and enforcing, through dispute settlement, the international trade rules.
• In 1995 this agreement on trade in goods became the World Trade Organization.
• The GATT was very successful in lowering tariffs, the then existing major barrier to free trade. • The first five rounds of multilateral trade negotiation succeeded in lowering tariff barriers substantially. This shifted protectionism to non tariff barriers. (NTB)
• The GATT accomplished these goals through:
• multilateral negotiations
• dispute settlement
• However the dispute settlement mechanism was very weak in that a losing party could simply block the adoption of an adverse decision.
WORLD TRADE ORGANIZATION (WTO)
INTRODUCTION:-
World Trade Organization (WTO) is a successor / replacement of GATT (General
Agreement on Tariffs and Trade) which was established in 1994. Pakistan has been a
W.T.O member since January, 1995. Pakistan is one of the founder members of both the
GATT and the WTO. At present the WTO has nearly 150 members of world trade,
(representing over 95% of world trade), of which there are 100 developing countries including Pakistan. The WTO headquarters’ based in Geneva, Switzerland and is headed by a Director General. The WTO's top level decision-making body is the Ministerial
Conference, which meets at least once every two years and appoints the Director General
WTO. Moreover, there is a General Council which is the body that oversees the day-today operation of the WTO. It also reviews national trade policies and oversees the dispute settlement process. The basic theme of WTO is to promote free trade and it is based upon the principle of comparative advantages i.e. to utilize the available global resources in the best possible manner.
OBJECTIVES:-
· The WTO's overriding objective is to help trade flow smoothly, freely, fairly and predictably. · It deals with the rules of trade between nations at a global level.
· It's an organization for liberalizing trade.
· It's a forum for governments to negotiate trade agreements and down trade related disputes between nations.
· The WTO is a place where member governments try to sort out the trade problems they face with each other.
· The WTO's rules - the agreements - are the result of negotiations between the members.
· It is an international body that promotes and enforces the provisions of the Trade Laws and Regulations.
· It is aimed to enhance the overall welfare both consumers and producers in the global market. · The WTO is also formally structured organization whose rules have legal binding on its member states.
· The organization provides framework for international trade laws.
· Member countries can refer trade disputes to WTO.
International Monetary Fund (IMF)
The IMF is an independent international organization. It is a cooperative of 185 member countries, whose objective is to promote world economic stability and growth. The member countries are the shareholders of the cooperative, providing the capital of the
IMF through quota subscriptions. In return, the IMF provides its members with macroeconomic policy advice, financing in times of balance of payments need, and technical assistance and training to improve national economic management.
The IMF is one of several autonomous organizations designated by the United Nations
(UN) as “Specialized Agencies,” with which the UN has established working relationships. The IMF is a permanent observer at the UN. The Articles of Agreement that created the
IMF and govern its operations were adopted at the United Nations Monetary and
Financial Conference in Bretton Woods, New Hampshire, on July 22, 1944, and entered into force on December 27, 1945
Mandates of IMF
• To promote international monetary cooperation through a permanent institution this provides the machinery for consultation and collaboration on international monetary problems. • To facilitate the expansion and balanced growth of international trade, and to contribute thereby to the promotion and maintenance of high levels of employment and real income and to the development of the productive resources of all members as primary objectives of economic policy.
• To promote exchange stability, to maintain orderly exchange arrangements among members, and to avoid competitive exchange depreciation.
• To assist in the establishment of a multilateral system of payments in respect of current transactions between members and in the elimination of foreign exchange restrictions which hamper the growth of world trade.
• To give confidence to members by making the general resources of the IMF temporarily available to them under adequate safeguards, thus providing them with opportunity to correct maladjustments in their balance of payments without resorting to measures destructive of nation
• To shorten the duration and lessen the degree of disequilibrium in the international balances of payments of members. This mandate gives the IMF its unique character as an international monetary institution, with broad oversight responsibilities for the orderly functioning and development of the international monetary and financial system.
World Bank
An international banking organization established to control the distribution of economic aid among member nations, and to make loans to them in times of financial crisis. The
World Bank provides financial and technical assistance to emerging market countries.
The World Bank is not actually a bank in the common sense. Instead, it consists of two development institutions -- the International Bank for Reconstruction and Development
(IBRD) and the International Development Association (IDA) owned by 186 member countries. The Bank is closely affiliated with three other organizations --the International
Finance Corporation (IFC), the Multilateral Guarantee Agency (MIGA), and the
International Centre for the Settlement of Investment Disputes (ICSID) -- that support its goal of reducing worldwide poverty. The five organizations make up the World Bank
Group.
History
The World Bank was created at Bretton Woods in 1944 to lend to European countries to help them rebuild after World War II. It was the world's first multilateral development bank, and was funded through the sale of World Bonds. Its first loans were to France and other European countries, but soon lent money to Chile, Mexico and India to build power plants and railways. By 1975, the Bank also lent money to countries to help with family planning, pollution control and environmentalism.
Purpose of the World Bank
The World Bank provides low-interest loans, interest-free credits and grants to developing countries. In the past, this usually occurred when they were in danger of sovereign debt default, itself often a result of overspending and extensive borrowing.
Many countries then devalued their currencies, which resulted in hyperinflation. To combat this, the Bank often required austerity measures, where the country must agree to cut back on spending and support its currency.
The World Bank loans are usually to invest in education, health, and infrastructure. The loans can also be used to modernize a country's financial sector, agriculture, and natural resources management. The Bank's goal is to "bridge the economic divide between poor and rich countries, to turn rich country resources into poor country growth and to achieve sustainable poverty reduction."
To achieve this goal, the Bank focuses on six areas:
• Overcome poverty by spurring growth in the poorest countries, focusing on Africa.
• Offer reconstruction to poor countries emerging from war, a major contributing factor to extreme poverty.
• Provide a customized development solution to help those middle-income countries overcome problems that could throw them back into poverty.
• Spur governments to act on preventing climate change, controlling communicable diseases, (especially HIV/AIDS and malaria), managing international financial crises, and promoting free trade.
• Work with the League of Arab States to improve education, build infrastructure and provide micro-loans to small businesses in the Arab world.
UNO
The theme behind the establishment of UNO was the universal human desire for peace.
Initially a charter was signed by USA and UK on 14 August 1941, which regularized the use of the name of the United Nations Organization. By January 1, 1942, 26 countries of the world had embraced the charter. The Moscow declaration of Octobor 1943, stressed the necessity of establishing an international organization for peace. China, USSR
(Russia), UK and USA were signatories to the Moscow declaration. The condition was fulfilled in Octobot 24, 1945 and the United Nations came into existence. The head office of the UNO is located in New York.
By march 2000 the membership of UNO rose to 200 member states.
The UNO is a general international organization establish at the end of the Second
World War to promote international peace and security. It is second such organization having replace league of nations which was founded after the First World War.
AIMS AND OBJECTIVES OF UNITED NATIONS ORGANIZATION
(UNO) :
1. To maintain international peace and security to help in finding a peaceful solution of disputes. 2. To Support recognition of mutual regard for each other's rights establishment of an environment of mutual friendship and people's right of self determination.
3. To help various nations in resolving international economic, culture, social and humans problems.
4. To safeguard human rights without prejudice to colour, creed, language or religion.
5. To provide a central forum for the collective struggle for achievement of all those objectives. 6. To provide a central forum for the collective struggle for the achievement of all these objectives. MAIN ORGANS OF UNITED NATIONS ORGANIZATION (UNO) :
1.TheSecurityCouncil.
2.TheGeneralAssembly.
3.TheEconomicandSocialCouncil.
4.The Trusteeship Council.
5.The Internal Court of Justice.
6. The Secretariat.
SPECIALIZED AGENCIES OF UNITED NATIONS
ORGANIZATION (UNO) :
1.ILO(International Labour Organization)
2.FAO(Food and Agricultural Organization)
3.WH(World Health Organization)
4. UNESCO ( United Nations Educational Scientific and Cultural Organization)
5. UNICEF (United Nation International Children's Emergency Fund)
6. IBRD (International Bank for Reconstruction and Development World Bank)
7. IMF (International Monetary Fund)