Sunday, June 11, 2017

World Trade Organization OPEC

World Trade
Today it is not unusual to find products from all over the world right in your own home. This is possible because countries all over the world are trading with one another. Telecommunications and other new technologies have made international trade much easier.

It might seem that every country in the world would trade with every other country. Sometimes, however, countries cut back or cut off trade with another country because of that country's actions or beliefs. For example, many countries stopped trading with South Africa because of its policy of apartheid.

Sometimes a country uses a policy of protectionism in its dealings with other countries to help the sale of its own products. It may add a tariff, or import charge, to the price of another country's product, such as cars. This protects its own market for that product. For example, cars made within the country will cost less than cars from other places. This influences buyers to choose the country's own cars.

Lately countries have found it better to work with one another. Many countries have come together to form the World Trade Organization (WTO). This group has the authority to decide trading disagreements between member countries.

In recent years many countries have also joined to form groups that trade freely with one another. Often the groups are made up of countries in the same region of the world. Some of these groups are the Asia-Pacific Economic Cooperation (APEC), the Latin American Integration Association (ALADI), and the North American Free Trade Agreement (NAFTA) members.

At times countries might also form a group because they share a common interest. The countries that make up the Organization of Petroleum Exporting Countries, or OPEC, formed their organization to gain control of the price of their oil in other parts of the world. The greater part of the world's oil is located in countries such as Algeria, Libya, Kuwait, Iran, Iraq, and Saudi Arabia. Venezuela, Indonesia, Nigeria, and Ecuador are also OPEC members. OPEC allows member countries to set standard prices for oil.

Why did OPEC form?

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