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Which Group Primarily Helps Settle Trade Disputes?

Which group primarily helps settle trade disputes?

a) European Union
b) World Trade Organization
c) Association of Southeast Asian Nations
d) North American Free Trade Agreements

This question is a part of the Econ Answers.


Answer: b) World Trade Organization.

The World Trade Organization (WTO) is an intergovernmental organization that regulates international trade. Established in 1995, the WTO provides a framework for negotiating trade agreements and a dispute resolution process aimed at enforcing participants’ adherence to WTO agreements.

World Trade Organization

Overview of the World Trade Organization (WTO)

  • Foundation: The WTO was established on January 1, 1995, succeeding the General Agreement on Tariffs and Trade (GATT) that had been in place since 1948.
  • Members: As of now, the WTO has 164 member countries, making it one of the largest international economic organizations in the world.
  • Purpose: The main objective is to ensure that trade flows as smoothly, predictably, and freely as possible.

Role in Settling Trade Disputes

  • Dispute Settlement Understanding (DSU): The WTO’s mechanism for resolving trade quarrels under the Dispute Settlement Understanding is vital in enforcing the rules and ensuring that trade flows smoothly.
  • Process: Countries bring disputes to the WTO if they think their rights under the agreements are being infringed. Judgments by specially appointed independent experts are based on interpretations of the agreements and individual countries’ commitments.
  • Enforcement: The WTO has the ability to authorize sanctions against a country that does not comply with its rulings.

Comparison with Other Options

  • a) European Union (EU): A political and economic union of 27 European countries. While it does handle trade disputes within its member states, its primary focus is not global trade dispute resolution.
  • c) Association of Southeast Asian Nations (ASEAN): A regional intergovernmental organization comprising ten Southeast Asian countries. Its main objectives are to promote peace and stability, economic growth, and shared prosperity in the region.
  • d) North American Free Trade Agreements (NAFTA): An agreement signed by Canada, Mexico, and the United States, creating a trilateral trade bloc in North America. It primarily deals with trade between these three nations.

While various organizations and agreements play significant roles in international trade, the WTO stands out as the primary global body dedicated to resolving trade disputes. Its structured approach and wide membership make it pivotal in ensuring that international trade is fair and just.


  1. World Trade Organization – Official Website
  2. European Union – Official Website
  3. ASEAN – Official Website
  4. Office of the United States Trade Representative – NAFTA

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