Directions (Qs. 1-5): Read the given passage carefully and choose the most appropriate option to the questions given below.
The World Trade Organisation (WTO) was created in the early 1990s as a component of the Uruguay Round negotiation. However, it could have been negotiated as part of the Tokyo Round of the 1970s, since negotiation was an attempt at a ‘constitutional reform’ of the General Agreement on Tariffs and Trade (GATT). Or it could have been put off to the future, as the US government wanted. What factors led to the creation of the WTO in the early 1990s?
One factor was the pattern of multilateral bargaining that developed late in the Uruguay Round. Like all complex international agreements, the WTO was a product of a series of trade-offs between principal actors and groups. For the United States, which did not want a new organization, the disputed settlement part of the WTO package achieved its long-standing goal of a more effective and more legal dispute settlement system. For the Europeans, who by the 1990s had come to view GATT dispute settlement less in political terms add more as a regime of legal obligations, the WTO package was acceptable as a means to discipline the resort to unilateral measures by the United States. Countries like Canada and other middle and smaller trading partners were attracted by the expansion of a rule-based system and by the symbolic value of a trade organization, both of which inherently support the weak against the strong. The developing countries were attracted due to the provisions banning unilateral measures. Finally, and perhaps most important, many countries at the Uruguay Round came to put a higher priority on the export gains than on the import losses that the negotiation would produce, and they came to associate the WTO and a rule-based system with those gains. This reasoning – replicated in many countries – was contained in U. S. Ambassador Kantor’s defence of the WTO, and it announced to a recognition that international trade and its benefits cannot be enjoyed unless trading nations accept the discipline of a negotiated rule-based environment.
A second factor in the creation of the WTO was pressure from lawyers and the legal process. The dispute settlement system of the WTO was seen as a victory of legalists but the matter went deeper than that. The GATT, and the WTO, are contract organizations based on rules, and it is inevitable that an organization creating a further rule will in turn be influenced by legal process. Robert Hudee has written of the ‘momentum of legal development’, but what is this precisely? Legal development can be defined as promotion of the technical legal values of consistency, clarity (or certainty) and effectiveness; these are values that those responsible for administering any legal system will seek to maximize. As it played out in the WTO, consistency meant integrating under one roof the whole lot of separate agreements signed under GATT auspices; clarity meant removing ambiguities about the powers of contracting parties to make certain decisions or to undertake waivers; and effectiveness meant eliminating exceptions arising out of grandfather-rights and resolving defects in dispute settlement procedures and institutional provisions. Concern for these values is inherent in any rule-based system of cooperation, since without these value rules would be meaningless in the first place, therefore, create their own incentive for fulfilment.
The moment of legal development has occurred in other institutions besides the GATT, most notably in the European Union (EU). Over the past two decades the European Court of Justice (ECJ) has consistently rendered decisions that have expanded incrementally the EU’s internal market, in which the doctrine of ‘mutual recognition’ handed down in Cassis de Dijon case in 1979 was a key turning point. The court is now widely recognized as a major player in European integration, even though arguably such a strong role was not originally envisaged in the Treaty of Rome, which initiated the current European Union. One means the Court used to expand integration was the ‘teleological method of interpretation’, whereby the actions of member states were evaluated against ‘the accomplishment of the most elementary goals set forth in the Preamble to the (Rome) treaty. The teleological method represents an effort to keep current policies consistent with slated goals, and it is analogous to the effort in GATT to keep contracting party trade practices consistent with slated rules. In both cases legal concerns and procedures are an independent force for further cooperation. In the large part the WTO was an exercise in consolidation. In the context of a trade negotiation that created a near-revolutionary expansion of international trade rules, the formation of the WTO was a deeply conservative act needed to ensure that the benefits of the new rules would not be lost. The WTO was all about institutional structure and dispute settlement: these are the concerns of conservatives and not revolutionaries, that is why lawyers and legalists took the lead on these issues. The WTO codified the GATT institutional practice that had developed by custom over three decades, and it incorporated a new dispute settlement system that was necessary to keep both old and new rules from becoming a sham. Both the international structure and the dispute settlement system were necessary to preserve and enhance the integrity of the multilateral trade regime that had been built incrementally from the 1940s to the 1990s.
1. In the method of interpretation of the European Court of Justice
(a) Actions against member states needed to be evaluated against the said community goals.
(b) Contracting party trade practices need to be consistent with stated rules.
(c) Current policies need to be consistent with stated goals.
(d) Enunciation of the most elementary community goals needed to be emphasized.
2. In the statement ‘… it amounted to a recognition that international trade and its benefits cannot be enjoyed unless trading nations accept the discipline of a negotiated rule-based environment’, it refers to
(a) The export gains many countries came to associate with a rule-based system.
(b) The higher priority on export gains placed by many countries at the Uruguay Round.
(c) The provision of a rule-based system by the WTO.
(d) Ambassador Kantor’s defence of the WTO.
3. According to the passage, WTO promoted the technical legal values partly through
(a) Integrating under one roof the agreements signed under GATT.
(b) Grandfather-rights exceptions and defects in dispute settlement procedures
(c) Rules that create their own incentive for fulfilment
(d) Ambiguities about the powers of contracting parties to make certain decisions.
4. The most likely reason for the acceptance of the WTO package by nations was that
(a) They recognized the need for a rule-based environment to protect the benefits of increased trade
(b) It settles disputes more legally and more effectively
(c) It has the means to prevent the US from taking unilateral measures
(d) Its rule-based system leads to export gains.
5. What would be the closest reason why WTO was not formed in 1970s?
(a) The US government did not like it
(b) Lawyers did not work for the dispute settlement system
(c) The Tokyo Round negotiations was an attempt at constitutional reform
(d) Important players did not find it in their best interest to do so.
Directions (Qs. 6-10): In each of the following sentences, some part of the sentence or the entire sentence is underlined. Beneath each sentence, you will find four ways of phrasing the underlined part. Choose the most appropriate option given in each of the sentences given below that is the best version than the underlined part of the sentence
6. Plausible though it sounds, the weakness of the hypothesis is that it does not incorporate all relevant facts.
(a) though the hypothesis sounds plausible, its weakness
(b) even though it sounds plausible, the weakness of the hypothesis
(c) the weakness of the hypothesis which sounds plausible.
(d) though plausible, the hypothesis’ weakness
7. During her lecture, the speaker tried to clarify directional terms, for not everyone in attendance was knowledgeable that winds are designed by the direction from which they come.
(a) For everyone in attendance did not know.
(b) With everyone in attendance not knowing.
(c) With everyone attending not knowledgeable.
(d) For not everyone attending knew.
8. Two valence states of uranium, one with a deficit of four electrons and the other one with a deficit of six occurs in nature and contributes to the diversity of uranium’s behaviour.
(a) the other with a deficit of six, occur in Nature and contribute
(b) the other one a deficit of six, occur in Nature and contribute
(c) the other with a deficit of six, occurs in Nature and contributes
(d) one with six occurs in Nature and contributes.
9. Initiative and referendum, is a procedure that allows voters to propose and pass laws as well as to repeal them.
(a) will allow voter to propose, pass, as well as to repeal laws.
(b) allows voters to propose, pass and to repeal laws
(c) will allow laws on be proposed, passed, as well as repealed by voters
(d) allows voters to propose to pass, and repeal laws.
10. Many of them chiselled from solid rock centuries ago the mountainous regions are dotted with hundreds of monasteries.
(a) The mountainous regions are dotted with hundreds of monasteries, many of them chiselled from solid rock centuries ago.
(b) Hundreds of monasteries, many of them chiselled from solid rock centuries ago, are dotting the mountainous regions.
(c) The mountainous regions are dotted with hundreds of monasteries, many of which are chiselled from solid rock centuries ago.
(d) chiselled from solid rock centuries ago, the mountainous regions are dotted with many hundreds of monasteries.
Answers: 1. (a), 2. (a), 3. (a), 4. (a), 5. (d), 6. (a), 7. (d), 8. (a), 9. (b), 10. (a)