The World Trade Organization: Global Rule-maker?

Abstract

Globalization at the corporate level has been strongly influenced and facilitated by, inter alia, a worldwide trend, especially during the 1990s, towards the liberalization of governments’ FDI policies; the latter have been linked to wider programmes of deregulation, privatization and market reform. There is still a long way to go in investment liberalization, particularly in some major developing nations and transition economies, and the process is far from irreversible. Since MNEs’ investment may generate economic benefits for nation-states and the world economy, as international trade has, locking-in the liberalization that has been achieved, providing a coherent global policy framework for FDI² and extending policy into new areas are critical if the momentum of corporate globalization is to be sustained. This requires a system of investment rules to complement the multilateral trade regime negotiated and implemented through the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO).