Benefits of Membership in the World Trade Organization (WTO) for Crude Oil Dependent Economies

Given the engagement of Iran in the process for gaining membership in the WTO, the question that is worth considering is can Iran benefit from membership in WTO in order to accelerate its socio-economic development plans, given the dependence of the economy on crude oil and oil derivatives, which in total account for 90% of the country's exports.Many developing countries, including a number of oil exporting countries, joined the WTO during the 1990s in the hope of accelerating their socio-economic development by virtue of trade liberalization. The current study which uses the Balassa Revealed Comparative Advantage (RCA) to study differences between countries that are members of WTO and non-member countries, does not demonstrate a meaningful difference in terms of diversity of export items or increasing specialization in the production of more complex products. It shows that oil exporting countries continue to be involved in exports of oil and its derivatives. It shows that WTO membership in itself does not generate any changes, but rather its beneficial effects are a function of specific policy interventions for changing the comparative advantage of the country away from production and export of primary products to production and export of complex products.