Question 1

Which WTO term refers to duties imposed on imported goods to offset subsidies provided by the exporting country's government?

Accepted Answer

Countervailing duties. Countervailing duties are specific tariffs used to neutralize the negative effects of subsidies in the exporting country. They help restore fair competition between domestic and imported products. These measures are governed by the Agreement on Subsidies and Countervailing Measures.

Question 2

In WTO terminology, which 'box' includes agricultural subsidies that are considered trade-distorting and must be reduced?

Accepted Answer

Amber Box. The Amber Box contains all domestic support measures considered to distort production and trade. Member nations are required to limit these subsidies to a specific 'de minimis' level. Examples include market price supports and direct production-linked payments.

Question 3

What is the practice of exporting a product at a price lower than the price it normally charges in its own home market called?

Accepted Answer

Dumping. Dumping occurs when a company exports a product at a lower price than its normal value. The WTO allows countries to take action against dumping if it causes material injury to the domestic industry. Anti-dumping duties are the common corrective measure used in such cases.

Question 4

Which WTO agreement deals with technical regulations and standards to ensure they do not create unnecessary obstacles to trade?

Accepted Answer

TBT Agreement. The Technical Barriers to Trade (TBT) Agreement ensures that technical regulations and standards are non-discriminatory. It encourages countries to use international standards wherever possible to facilitate smoother trade. This helps prevent countries from using technical rules as disguised protectionism.

Question 5

A trade agreement that is signed by only a subset of WTO members rather than all members is known as a?

Accepted Answer

Plurilateral agreement. Plurilateral agreements involve only those WTO members who choose to accept the specific terms. Unlike multilateral agreements, they do not create obligations for the entire WTO membership. The Information Technology Agreement is a well-known example of such an arrangement.

WTO & Trade — Set 1