“Brazil vs. the US at the WTO Cotton Subsidy Dispute Case Study” Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

“Brazil vs. the US at the WTO Cotton Subsidy Dispute Case Study” Case Solution

Question-1

There are two main ways that WTO resolves a trade process. These includethe gatherings to trackdown into the common point among the two different points of discussion. Another way to resolve dispute is through adjudication, counting the ensuing execution of the board and the “Appellate Body reports”.

WTO Settlement Process vs. GATT Dispute Process

The WTO settlement process comprises three main processes. These process includes party’s consultation, adjudications by panels and Appellate body and ruling implementation which rememberthe opportunity of countermeasures for the event of disillusionment by the losing party to execute the choice.On the other hand, “GATT dispute settle system” satisfies the parties by providing them with the solutions in majority of the cases. (Jackson, 2000)

Question-2

A subsidy or government impetus is a type of monetary guide to promote the social or economic policies or rules. According to the “WTO’s Subsidies and Countervailing Measures (SCM) agreement”, the prohibited and action subsidies includes; (Baffes, 2011)

Prohibited Subsidies

The prohibited subsidies comprise two categories. The first category comprises “subsidy contingent”. These subsidies are known as “export subsidies”. The second category is known as “local content subsidies”. These subsidies depend upon the utilization of homegrown over imported products. These subsidies are prohibited because they have the direct effect on the trade.

Actionable Subsidies

“Actionable subsidies”, for example, “creation sponsorships” are not denied and go under the classification of significant. These sponsorships prompt difficulties by either through balancing activity or question settlements. There are three sorts of antagonistic affects brought about by the actionable subsidies; these incorporates

The injury to a homegrown industry brought about by sponsored import
Serious prejudice caused by the export displacement
Lastly, benefits impairment building under the “GATT 1994”

Question-3

The Brazil, a major competitor of cotton, expressed its concerns related to the US cotton subsidies by sourcing and starting the “WTO dispute settlement case”. This case startswith the US cotton program. This case follows the long sequence of events to resolve the dispute within the “15 month time frame”. In any case, the "WTO dispute settlement (DS)" process that surveyed Brazil's charges against the "US cotton program" has broadened well past the "theoretical 15-month time period". The case was based upon the unfair distribution of subsidies.

Question-4

The threat of authorizations prompted extreme exchanges among “Brazil and the United States” to track down a common understanding and keep away from the exchange reprisal. Both parties reach a common point. This was effective because Azevedo realized how humiliating it would be for US policymakers to make this yearly installment to Brazil as they looked to revise or renegotiate. This will lead the US to drop the subsidies by themselves.Therefore, the Brazil’s deal with trade negotiators was effective in so many conditions.

Question-5

The “WTO dispute settlement board” tracked down that specific US rural help installments and certifications, including the installments to cotton makers under the advertising advance and counter-recurrent projects, and credit ensures under the “GSM-102 program”. These were conflicting with “WTO” responsibilities. In 2005, the United States rolled out a few improvements to the two of its cotton and GSM-102 projects trying to carry them into a consistence with WTO suggestions. Brazil contended that the US reaction was insufficient. A WTO consistence board decided on Brazil’s resistance to charge against the United States in “December 2007”, and the decision was maintained on claim in June 2008.TheUS cotton creation could clasp assuming the United States bows to the “World Trade Organization” and takes out specific sponsorships the “WTO court” has governed opposition worldwide exchange rules.

Question-6

The lessons for international manager for this case includes;

The managers should plan’s and implement a global strategy by delegating the new policies and rules
They should see and overcome the company’s political, cultural and operational challenges
The case highlights how the Azevedo has offered the deal to the US so that they can drop the subsidy. This highlights the importance of the decision proposed by the party.

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“Brazil vs. the US at the WTO Cotton Subsidy Dispute Case Study” Harvard Case Solution & Analysis