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Growth of International Organizations: History, Events, and Trends

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  • 0:08 International Organizations
  • 0:44 European Union
  • 2:40 NAFTA & Asian Trade Deals
  • 5:13 UN & NATO
  • 6:42 Lesson Summary
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Lesson Transcript
Instructor: Christopher Sailus

Chris has an M.A. in history and taught university and high school history.

In this lesson, we explore the growth of international organizations since the 1990s, especially the proliferation of trade deals and the expanding reach of existing organizations like the UN, NATO, and the EU.

International Organizations

There's a popular saying in history and economic circles that claims no two countries that have a McDonald's have ever gone to war. Though the theory, first coined by the economist and columnist Thomas Friedman, is not strictly true, the sentiment behind the phrase largely is; that is, that countries that have trade deals and work together with one another have little impetus for fighting each other. Perhaps then, it's due to the growth of international organizations that we have yet to experience a World War III. In this lesson, we will explore the growth of international organizations in the past quarter century and discover the effects they have had on global politics.

European Union

Europe's premier international organization, the European Union (EU), had humble beginnings. In 1951, France, Italy, West Germany, Netherlands, Belgium, and Luxembourg created the European Coal and Steel Community to encourage the sharing of industrial resources between the six of them, all of whom were rebuilding from the devastation of World War II. By 1990, that organization had doubled in size and added several layers of government that intertwined these six countries more closely - politically, economically, and socially.

Five of the six countries added before 1990 - Great Britain, Ireland, Denmark, Spain, and Portugal - were all generally in Western Europe, while the sixth, Greece, was a reasonably affluent Mediterranean country. In the 1990s and 2000s, the EU expanded into Eastern Europe and into many states that were formerly part of the Soviet Union or Warsaw Pact. The Maastricht Treaty established the European Union under its current name in 1993. Three more countries became members in 1995, and, in 2004, the total number of EU countries ballooned to 23. As of today, there are 28 EU countries (Croatia joined most recently in 2013).

Because the EU is an international organization, it recognizes 24 official languages. There are no tariffs or barriers restricting trade across borders within the EU. In addition, citizens of EU states enjoy the right to travel to any other EU country without restriction. Most of the EU also has a common currency, the Euro, which was introduced in financial institutions in 1999 and in bills and coins in 2002, further greasing the wheels of commerce across the continent. In recent years, there has been increased call for further political and diplomatic cooperation between states. The EU has made attempts at establishing a common foreign policy office. However, some states, such as the UK, are reluctant to transfer more power to the supranational institution.

NAFTA and Asian Trade Deals

Europe is not the only continent to create international organizations to increase trade between countries. In 1994, Canada, the United States, and Mexico created the North American Free Trade Agreement (NAFTA). In terms of sheer size and volume of trade, NAFTA became the largest international free trade zone in the world.

For example, the total value of U.S. goods traded in 2012 alone was greater than $1.2 trillion dollars! The agreement has not only fostered increased trade, but also increased foreign investment between the three countries. NAFTA also made it easier for businesses to move from one country to another. Critics of the organization often use this final point as an argument against NAFTA since several companies, especially auto manufacturers, have relocated higher wage jobs to Mexico where wages and production costs are less.

North America is not the only continent to join together in an international organization fostering free trade. For example, in Southeast Asia, the relatively smaller countries of Brunei, Indonesia, Philippines, Malaysia, Singapore, and Thailand created the Association of South East Asian Nations (ASEAN) in 1992. By the end of the decade, Vietnam, Laos, Myanmar, and Cambodia had joined the group. The ASEAN was created by these countries to present a large economic block that would be a viable competitor to larger economies in Asia, such as China or India. There are no tariffs or trade barriers within the ASEAN, and all governments have stated commitments to attracting foreign investment to their countries and the ASEAN in general.

NAFTA and the ASEAN are just a couple of the important trade deals that have occurred since 1990. Perhaps the most important, however, was the creation of a global trade organization that encompasses most of the countries already discussed, as well as over 100 more. Founded in 1994, the World Trade Organization (WTO) was created during the Uruguay Round of negotiations concerning the General Agreement on Tariffs and Trade to govern the GATT moving forward and ensure that global trade moves as freely and fairly as possible across international borders.

The WTO, and GATT in particular, are still relatively controversial. They have had some great positive effects on developing nations, giving countries in Africa, Asia, and Latin America access to cheaper grains and foodstuffs than they previously had. At the same time, the WTO is also criticized as forcibly and violently exposing developing countries to the tumultuous trends of global markets and forcing producers in developing markets to sell their goods at below cost to remain competitive.

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