An offer developing countries could not refuse: how powerful states created the World Trade Organisation

Abstract

Drawing on Michael Barnett and Raymond Duvall’s concept of institutional power, this article presents the empirically ascertained asymmetries created by the World Trade Organisation (WTO) to investigate the Uruguay Round from a power standpoint. The argument is that developing countries, especially least developed nations, only accepted the WTO as a choice for the lesser of two evils. They are worse-off with the WTO trade regime, in contradiction to the positive-sum view of normative settings laid out by mainstream International Relations (IR) since the 1980s. The concept of institutional power is broken down into the sub-categories of ‘go-it-alone’ power, market power and forum-shifting power to demonstrate how the United States and the European Communities relied on their huge markets to shift the forum in charge of intellectual property and impose on developing countries a choice between accepting the WTO Agreement and being denied access to the world’s two largest markets. Developing countries thus rationally became members of an organisation that entails absolute losses to them. The argument that institutions such as the WTO are desirable because they are agreed to does not reflect the realities of power and is ultimately an ideological stance that precludes mainstream IR from grasping how institutions (re)produce inequalities.