INTRODUCTION TO WTO
• WTO Established Jan 1, 1995 Created by : Uruguay
round negotiation (1986-1994) Members: 153
•recent: Saudi Arabia December 2005 •Including:
China (as of 2001)
•Not including: Russia, Iran, Iraq, N. Korea
• Headquarters: Geneva, Switzerland
WHY GATT REPLACED BY WTO ?
• Gatt rules applied to trade only in merchandise
• 2. Gatt dispute settlement system is slow.
• 3. Gatt was just provisional agreement.
STRUCTURE OF WTO
• The WTO is run by its member governments. All
major decisions are made by the membership as a
whole, either by ministers , who meet at least once
every two years, Decisions are normally taken by
consensus. the WTO is different from some other
international organizations such as the World Bank
and International Monetary Fund. In the WTO,
power is not delegated to a board of directors or
the organization’s head .
• The countries make their decisions through various
councils and committees, whose membership
consists of all WTO members. The Ministerial
Conference can take decisions on all matters under
any of the multilateral trade agreements.
CHART OF THE WTO STRUCTURE
• 1 1. Council for Trade in Goods:
• 1 1. Council for Trade in Goods Since 1995, the
updated GATT has become the WTO’s umbrella
agreement for trade in goods. It has dealing with
specific sectors such as agriculture and textiles, and
with specific issues such as state trading, product
standards, subsidies and actions taken against
2. COUNCIL FOR TRADE IN SERVICES :
• 2 . Council for Trade in Services Banks insurance
firms telecommunications companies tour operators
hotel chains transport companies.
• Example of Telecommunication services: :
• The telecommunications sector has a dual role: it is
a distinct sector of economic activity; and it is an
underlying means of supplying other economic
for example: electronic money transfers.
3. INTELLECTUAL PROPERTY
• The WTO’s Intellectual Property Agreement amounts
to rules for trade and investment in ideas and
creativity. The rules state how Copyrights patents
trademarks geographical names used to identify
products industrial designs “ intellectual property” –
should be protected when trade is involved.
• The WTO’s procedure for resolving trade quarrels
under the Dispute Settlement. Understanding is vital
for enforcing the rules and therefore for ensuring
that trade flows smoothly.
5.TRADE POLICY REVIEW :
• The Trade Policy Review Mechanism’s purpose is to
improve transparency, to create a greater
understanding of the policies that countries are
adopting, and to assess their impact.
FUNCTION OF ORGANIZATION:
• The WTO’s overriding objective is to help trade flow
smoothly, freely, fairly and predictably. It does this
by: Administering trade agreements Acting as a
forum for trade negotiations Settling trade disputes
Reviewing national trade policies Assisting
developing countries in trade policy Organize
training programmers Cooperating with other
THE WTO DEALS WITH THE SPECIAL NEEDS OF
DEVELOPING COUNTRIES IN THREE WAYS
• 1. WTO Agreements
• 2. WTO Committees
• 3. WTO Technical Cooperation
• WTO AGREEMENTS In the agreements: more time,
better terms Legal assistance: a Secretariat service
Least-developed countries: special focus A
‘maison’ in Geneva: being present is important, but
not easy for all
2. WTO COMMITTEES
• Trade and Development Committee, Sub-
committee on Least-Developed Countries.
• The Doha agenda committees
3. WTO TECHNICAL COOPERATION
• Training Seminars, workshops.
THE DOHA ROUND:
• The Doha Round The Doha Round is the latest round
of trade negotiations among the WTO membership.
Its aim is to achieve major reform of the
international trading system through the
introduction of lower trade barriers and revised
trade rules. The work programmed covers about 20
areas of trade. The Round is also known semi-
officially as the Doha Development Agenda as a
fundamental objective is to improve the trading
prospects of developing countries.
IMPACT ON INDIA:
• Problems faced Commitments made Potential
solutions to existing problems
PROBLEMS FACED BY INDIA IN
WTO AND ITS IMPLEMENTATION:
• Predominance of developed nations in
negotiations Non-tariff barriers being created by
developed nations. Regional cooperation groups
posing threat to utility of WTO agreement itself,
which is multilateral encompassing all member
countries Poor implementation of Doha
Development Agenda Pressure to dismantle MFA (
Muti Fibre Agreement) Under TRIPS question of high
INDIA’S COMMITMENT TO WTO
• Reduction in tariff and non-tariff barriers
Amendment in Patent Act;
• Trade Related Intellectual Property rights (TRIPs)
• Trade related investment measures (TRIMs)
• General Agreement on Trade services (GATS)
WHAT INDIA SHOULD DO?
• Should speed up internal reforms in building up
• Should focus on R&D in important fields Helping
textile and garment Industry go multinational
Invoking reforms facilitating major FDI inflows.
• Should downsize non-plan expenditure in Subsidies
Lots of potential in renewable energy generation
THE 10 BENEFITS
1. The system helps promote peace.
2. Disputes are handled constructively.
3. Rules make life easier for all.
4. Freer trade cuts the costs of living.
5. It provides more choice of products and qualities.
6. Trade raises incomes.
7. Trade stimulates economic growth.
8. The basic principles make life more efficient.
9. Governments are shielded from lobbying.
10. The system encourages good government
CRITICISMS OF WTO
1> WTO is the fundamentally undemocratic.
2> WTO will not make us safer.
3> WTO tramples labour and Human Rights.
4> WTO Would privatize essential services.
5> WTO is increasing inequality.
6> WTO is increasing hunger.
7> WTO hurts poor ,small countries in favour of rich