Opportunities and Risks of Supporting Manufacturing under WTO Rules

Abstract

Subsidized goods may provide unfair competitive advantages, since such advantages are received as a gift from the government, and not in equal competition with other companies. Nevertheless, it would be a mistake to believe that any governmental measures fall within the scope of the WTO rules. WTO members have provided support and will continue to support the national economy. The question is what is the nature of support and its impact on international trade. The article analyzes such issues as the concept and classification of subsidies in the context of the Agreement on Subsidies and Countervailing Measures, the peculiarities of subsidy programs, the difficulties of challenging subsidies as measures as such, the risks of obtaining subsidies and «smart» ways to support the industry.