Describe the various reasons that some countries still have quotas.

Question

Quizplus · Accepted Answer

The Answer is Quotas are considered such a harmful form of protectionism that they are banned by the WTO. Nevertheless, quotas still exist in various forms for four reasons. First, not all countries are members of the WTO. Countries that have not joined are free to impose quotas. Second, countries that are WTO members are allowed to maintain their previously existing quotas for a specified period of time. As such, all of the newly joined members are in the process of eliminating their quotas. Third, some countries implement quotas on some goods in defiance of WTO rules. The U.S. quota on sugar is an example. Fourth, international trade in textiles and apparel is profoundly distorted by the Multifibre Arrangement (MFA). For each developed country, the MFA manages trade in these two industries by enforcing a quota by product and by country for imports of textiles and apparel.

Describe the Various Reasons That Some Countries Still Have Quotas