WORLD TRADE

ORGANIZATIO
N

WHAT IS WORLD TRADE

ORGANIZATION
TheWorldTradeOrganization(WTO)is
anintergovernmentalorganizationwhich
regulatesinternationaltrade.TheWTOofficially
commencedon1January1995undertheMarrakesh
Agreement,signedby123nationson15April1994

FUNCTIONS
The main functions of WTO are discussed below:
Toimplementrulesandprovisionsrelatedtotradepolicy

reviewmechanism.
Toprovideaplatformtomembercountriestodecidefuture
strategiesrelatedtotradeandtariff.
Toprovidefacilitiesforimplementation,administrationand
operationofmultilateralandbilateralagreementsofthe
worldtrade.
Toadministertherulesandprocessesrelatedtodispute
settlement.
Toensuretheoptimumuseofworldresources.
Toassistinternationalorganizationssuchas,IMFandIBRD
forestablishingcoherenceinUniversalEconomicPolicy
determination.

OBJECTIVES:
The important objectives of WTO are:
To improve the standard of living of people in the
membercountries.
To ensure full employment and broad increase in
effectivedemand.
Toenlargeproductionandtradeofgoods.
Toincreasethetradeofservices.

BINDING AND
ENFORCEABLE
COMMITMENTS.
ThetariffcommitmentsmadebyWTOmembersin
amultilateraltradenegotiationandonaccession
areenumeratedinaschedule(list)ofconcessions.
Theseschedulesestablish"ceilingbindings":a
countrycanchangeitsbindings,butonlyafter
negotiatingwithitstradingpartners.

TRANSPARENCY.
TheWTOmembersarerequiredtopublishtheir
traderegulations,tomaintaininstitutionsallowing
forthereviewofadministrativedecisionsaffecting
trade,torespondtorequestsforinformationby
othermembers,andtonotifychangesintrade
policiestotheWTO.

SAFETY VALVE :
Inspecificcircumstances,governmentsareable
torestricttrade.TheWTO'sagreementspermit
memberstotakemeasurestoprotectnotonlythe
environmentbutalsopublichealth,animalhealth
andplanthealth.

POLICY REVIEW:

TheTradePolicyReviewMechanismspurposeisto
improvetransparency,tocreateagreaterunderstanding
ofthepoliciesthatcountriesareadoptingandtoassess
theirimpact.Manymembersalsoseethereviewsas
constructivefeedbackontheirpolicies.
AllWTOmembersmustundergoperiodicscrutiny,each
reviewcontainingreportsbythecountryconcernedand
theWTOSecretariat.

DISPUTES
Whatcausesadispute?
WhenamembercountryoftheWTObelieves
anothermembercountryisviolatingan
agreementoracommitmentthathasbeenset
withintheWTO.
Agreementsarethosenegotiatedunderthe
RoundsofGATT/WTO
Howisitresolved?
TheDisputeSettlementBodycomposedof
membergovernments(allWTOmembers)work
togethertosetanagreement.

STEPS (& LENGTHS) OF

SETTLEMENT

Consultation(60days)
ThePanel(45days/6months)
FinalReport(3weeks)
ReportbecomesaRuling(60days)

Eithersidecanappealapanelsruling.

5.AppealsReport(60-90days)
6.AppealsReportbecomesaRuling(30days)

UNITED STATES OF AMERICA AND

THE WTO
TheUnitedStatesofAmericahasbeenaWTO
membersince1January1995andamemberof
GATTsince1January1948.

TRADE BENEFITS AMERICAS

WORKERS & FAMILIES
Americanbusinesses,farmersandworkingpeople
tofindnewopportunities,createnewjobs,and
raisefamilylivingstandards.

PROMOTING U.S. EXPORTS AND JOBS

WTOruleslowertradebarriersabroadandhelpus
exportmoreofourgoodsandservicestoother
countries.
Onaverage,everybilliondollarsofgoodsand
servicesexportsresultsinthousandsofjobshere
athome.
Between1994and1998,1.3millionnewjobs
supportedbyexportsofgoodsandserviceshave
beencreatedintheUnitedStates.