An interesting paper on "WTO and good governance" tries to establish the link between member countries joining the WTO and improved governance within the country. The assertion has been made that the WTO has encouraged countries to clean up and make more transparent rules that have had an indirect impact on reducing corruption.
It concludes by stating,
" The WTO governs trade, and doesn’t directly address corruption. Yet we found considerable qualitative evidence that it is helping member states clean up. Before they accede, countries make major changes to their laws, regulations and behavior related to a wide range of trade and trade related policies from tax and competition policies to health and safety standards.. New member states are required to adopt trade related policies, laws and institutions based on transparency, due process, and evenhandedness. Member states monitor these changes at trade policy reviews. During these reviews, trade officials ask questions about compliance with WTO norms in trade policymaking. But they also ask new members about strategies to reduce corruption, involve the public, and ensure evenhandedness. In particular, the US, Canada, and the EU
sometimes asked other countries about their policies and behavior in areas of non-WTO competence—including advancing human rights or reducing corruption."
It argues that WTO encourages transparent multilateral rules that require domestic changes in policy and approaches.
The issue of corruption has gripped India over the past few months. India has been a long standing member of the GATT/WTO. However, has being a member of the WTO significantly reduced corrupt practises of the large governmental machinery that interfaces with the citizen? WTO stresses on transparent, even handed rule making in the arena of trade. How much of an impact does that have on local governance issues. Trade liberlisation may help in reducing bureaucratisation, arbitrariness/discretion in decision making and enhancing consumer choice in the field of trade. How much of that percolates to local governance? A transparent, rule based, non-discriminatory domestic trade regime would help reduce corruption at the interface of foreign trade players and government officials but to assume that it has a spillover effect in cleaning up governance as a whole is not borne out by facts. Corruption at the domestic level, whether it is large ticket corruption or petty retail corruption can be addressed, inter alia, by strong systemic processes that ensure compliance, transparency and accountability. It would be too much to expect the WTO or multi lateral trade regime to do that for you.