GATT / WTO / FTA and pursuing of free trade.

Background
Every all the countries have propensity to increase their exports and reduce imports.
If imports are greater than exports, then it will lead to the trade deficit. The expenditure of dollar will increase than the dollar earned. Later there will be currency outflow which will lead to reduction of foreign reserves. Therefore, the country will face the risk of losing purchasing power in external necessities such as oil, iron ore, etc. Eventually, the nation's fundamentals will be weakened. There will be tremendous inflation (stagflation) and the nation's economy will crash.

Of course, it's not that bad news for resource-rich countries, but it's very lethal for resource-poor countries like Korea, Japan, and China. Because they have to buy essential resources or food in order to foster their economy.

But there is a geopolitical problem. The action to raise trade barriers to protect domestic industries such as raising tariffs is seen from old days to the modern times. Tariffs are taxes on imported goods meaning it will increase the price of imported products.
As a result, consumers will lose the reason to purchase foreign product and find domestic products. If each country creates such tariff barriers, it will cause a great fight later on. World War II also was big example from this.

These factors lead to establishment in institutional policies or organizations like GATT, WTO, and FTA.

GATT
When the global economy was having difficult time during the Great Depression(1929), U.S (they had the strongest economy at that time) implemented protectionism to revive the economy by levying 60 percent tariff on imported goods on Canada and Europe, which lead to tariff retaliation back to U.S. World trade plunged, exports were blocked by country, production declined, industry halted, unemployment increased, and the global recession intensified. As the protection trade overheated, Japan, Germany, and Italy, trying to be one of the countries which have economic powers, faced economic difficulties, and eventually tried to resolve them with force. In the end, the protection trade in the United States caused World War II.

In 1947, after World War II, the GATT was established as a precautionary measure to prevent the war. The purpose of the establishment is to expand free trade so that the world can engage in economic cooperation. Consequently, the trade barrier was eased and the international trade system was established in the right order. South Korea joined the GATT in 1967 as the 71st country which became a foothold to be an export-driven country. 

WTO
In the 1970s, major industrial countries shifted to protectionism due to the first and second oil shocks. As trade pressure between countries rises, GATT was unable to stop the dispute. It was not an international organization but just a simple agreement. Dispute settlement system and the legal binding force were not very effective to stop the trade tension.

In addition, facing the limitations monetary system due to Bretton Woods system, President Nixon announced the New Economy Policy and adopted fiat money by abolishing the gold standard system. Fiat-money is not based on anything (maybe based on treasury bond), but to put the meaning of the currency itself. So, the volume of money increased rapidly and it played a role in mitigating barriers to the trade. The Uruguay Round negotiations were held and WTO was established. It is to prevent concerns over the spread of protectionism in the previous era as the dependence of the global economy deepened. Here is the rule of it:

- Pursue nondiscriminatory trade
- Concessionary tariff allowed
- Predictable and always accessible to the market.
- Stability in its free trade.
- Encourage fair competition.
- Aid the smooth economic development of frontier and emerging countries.

FTA
Multilateral trade negotiations to support for economic development have begun to feel limited in establishing new order. There was no settlement due to differences between developed countries and emerging markets. It is wiser to have trade negotiations between the countries as an alternative.

Increased free trade agreement (FTA) with bilateral trade negotiations was faster and more efficient than multilateral trade negotiations. FTA eases tariff and non-tariff barriers to promote mutual trade. However, it violates the principle of WTO including multilateral exception clause. However WTO also admits FTA for its value of “laissez-faire trade” or trade liberalization and contribute on prosperity on global economy.