Reaction Paper on "Fair Trade"

Reaction Paper 5 pages (1802 words) Sources: 5

[EXCERPT] . . . .

Fair Trade for All: The Czech Republic

Fair trade is designed to be fair to all countries, but in many cases what is "fair" to one country (or even several countries) leaves other countries at a distinct disadvantage. Examined here will be the Czech Republic and whether fair trade is appropriate for it. This is an important consideration, because the Czech Republic has fought hard for independence and its own sense of "self" in the world. Now that it has established these things, it has also moved into a different status category as it relates to other countries. Trade is designed to promote development, and on a scale of 1-100, the Czech Republic has a "fair trade" score of 85. In other words, most of the fair trade practices that are seen today work well for the Czech Republic because they offer it what it needs in order to continue to develop and move forward. Without that ability to develop, any country can find itself struggling to be successful. That is something that should (and can) be avoided by making sure any plan for development is implemented properly and followed correctly.

One of the things the Czech Republic has going for it is its membership in many world organizations, these include the North Atlantic Treaty Organization (NATO), International Whaling Commission, the Organization for Economic Co-operation and Development (OECD), the United Nations (UN), the International Energy Agency (IEA), the International Monetary Fund (IMF), and the World Trade Organization (WTO) (Stiglitz & Charlton, 2006). By belonging to so many different groups, the Czech Republic is allowing itself to have a better opportunity to work with other countries in order to make sure that every country is treated fairly. Trading between countries is a nearly vital exercise, and when countries work to trade with one another they are much more likely to have stronger economies that they can continue to improve upon by developing more trade.

The Czech Republic is also a member of the European Union (EU), and has been a member of that organization since 2004 (Stiglitz & Charlton, 2006). That membership is highly significant and fundamental to the Czech Republic being independent and continuing to succeed in its endeavors. Relations between the Republic and other nations have been good, although there have been a few disagreements. The most notable of those disagreements was over an amendment to a gaming law and agricultural quotas. The gaming law issue is not that significant for purposes of this paper, but the agricultural quotas matter. Those quotas are directly linked to trade, and it is very important to understand that trade issues can affect more than just how one country trades goods and services with others. When there are trade imbalances there are also economic problems which can lead to other serious difficulties within a country. By having good trade with other nations, the Czech Republic can avoid some of the other problems that can appear when there are trade problems.

Being a member of the United Nations (UN) is also important for the Czech Republic, as it participates in some of the more specialized agencies the UN has to offer. One of those agencies is the General Agreement on Tariffs and Trade. Being a part of that agency is highly significant because it allows the Republic to be aware of what is changing and to also focus on what kinds of changes it might like to see in the future. When a country is able to understand the true nature of the trade and tariff issues faced by the world, that country is also more likely to be understanding of the issues faced by other countries (Garrett, 1996). Additionally, that country can focus on ways to help other countries and the entire world have more successful trade arrangements because the country will be very aware of how the current regulations actually affect countries in the "real world." Until a country really works within the system, it can be hard for that country's government to understand completely the issues that are faced with tariffs and trade, which can lead to problems in the future.

Another benefit the Czech Republic has when it comes to fair trade is its good relations with other countries (Hockman, 1998). Currently it has strong diplomatic relations with over 85 other countries, and that gives it some "clout" and an ability to work with various countries to find ways to agree on trade issues that might not be solved easily (or at all) if relations were strained. Sixty-three of the countries with which the Czech Republic has good relationships have permanent representation in the Czech capital of Prague. That is another strong indication of the idea that the relationships between the countries are solid and that they will not be disbanded or disturbed easily. Becoming a member of NATO in 1999 was also a very large step for the Republic, and provided a strong milestone in both security orientation and foreign policy (Stiglitz & Charlton, 2006). While those are not trade directly, they are related to trade in that the trust countries have with one another and the way each country operates are both very important when it comes to whether countries will trade with a particular country or not. Countries that are serious about trading with other countries are also deeply interested in things such as the security and foreign policy beliefs of those other countries (Rich, Wilson, & Postan, 1977; Czech, 2006).

The World Trade Organization (WTO) membership is the most significant of the memberships held by the Czech Republic, however, because of the rules and regulations it makes regarding trade for the world. The WTO holds the livelihoods of billions of people, because it is not "just" a country that is affected. It is all the people in that country (Hockman, 1998). Some people fail to realize the severe and lasting impact that can occur when a country cannot trade with other countries safely and securely. Countries that belong to the WTO are generally able to trade more easily, but that does not mean that everything is equal for them. The more countries that work together and have good relationships with each other, the better it will be for all countries involved. Still, individuals who are not completely familiar with free trade agreements do not realize that fair trade does not always mean that the trade that is taking place is really "fair." In some cases, trade can still be skewed (Stiglitz & Charlton, 2006). While fair trade allows countries to trade with one another, there is still a discrepancy between rich countries and poor countries. Some argue that trade agreements make poor countries poorer and rich countries richer, but others do not feel that this is the case with these agreements.

For the individuals who believe that fair trade agreements are not the best choices, the argument is that these agreements do not lead to an eradication of poverty in countries that are struggling. In addition, it does not help the environment to be more sustainable. If fair trade is done right it can help countries and protect lives and liberty. If it is done wrong, however, it can actually make things worse. Poverty can be increased by having fair trade agreements, and harm can be caused to countries that are developing (Stiglitz & Charlton, 2006). This occurs because they are not getting what they need to compete with other countries that are already better established when it comes to trading. The Czech Republic is a large enough country and has been established for a long enough period of time that it is not being harmed by fair trade. It is actually growing and developing by having connections with other countries and by being able to trade with a large number of countries in the world. However, smaller and less-established countries are not able to trade as easily.

These countries can end up making trade agreements that are detrimental to them even though they know these are not the best choices. Often it is either make those kinds of agreements or do not make any agreements at all - in which case they will not be able to trade. One of the things that the Czech Republic and other countries that belong to the WTO should look at is a way to ensure that all countries are treated properly and fairly. That is what "fair" trade should be about, of course, and even though the trades that take place across and between countries in the present day are more fair than they used to be there are still issues that can and should be resolved when it comes to protecting countries that need help in order to move forward and continue to develop. The countries that are already developed are not having difficulties with the fair trade regulations set out by the WTO, but the countries that are not developed and still need help are struggling.… READ MORE

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