World Trade Organization

The WTO was established on 1st January 1995. The WTO is the successor to the the General Agreement of Tariffs and Trade (GATT).


The WTO has larger membership than GATT, the present number stands at 144. India is one of the founder members of WTO.

Objectives of WTO


Raising standard of living and incomes, promoting full employment, expanding production & Optimum utilisation of world's resources. Introduce sustainable development a concept which envisages that development & environment can go together. Taking positive steps to ensure that developing countries secure a better share of growth in world trade.

Functions of WTO
WTO is based in Geneva, Switzerland. Its functions are:


Administering & implementing the multilateral Plurilateral trade agreements, which together make up the WTO. Acting as a forum for multilateral trade negotiations. Seeking to resolve trade disputes Overseeing national trade policies. Cooperating with other international institutions involved in global economic policy-making.

Technical assistance & training for developing countries. Acting as a management consultant for world trade. Maintaining trade related database.

GATT & WTO



The GATT was a set of rules, a multilateral agreement, with no institutional foundation The GATT was applied on a provisional basis in the attempt to establish an ITO. The GATT rules applied to trading in merchandise goods.

The WTO is a permanent institution with its own secretariat. The WTO commitments are full and permanent. The WTO covers trading in goods, services & TRIPS. The agreements which constitute the WTO are all multilateral.

The GATT was a multilateral instrument, but by the 1980s many agreements had been added of a plurilateral nature. The GATT dispute settlement system was slow & there were a lot of blockages.

The agreements which constitute the WTO are all multilateral and involve commitments for the entire membership. The WTO dispute settlement system is faster, more automatic.

Advantages of WTO
World Trade Organization helps member states in various ways and this enables them to reap benefits such as: Helps promote peace within nations: Peace is partly an outcome of two of the most fundamental principle of the trading system; helping trade flow smoothly and providing countries with a constructive and fair outlet for dealing with disputes over trade issues. Peace creates international confidence and cooperation that the WTO creates and reinforces. Disputes are handled constructively:

Rules make life easier for all: WTO system is based on rules rather than power and this makes life easier for all trading nations. Free trade cuts the cost of living: Protectionism is expensive, it raises prices, WTO lowers trade barriers through negotiation and applies the principle of non-discrimination. It provides more choice of products and qualities: It gives consumer more choice and a broader range of qualities to choose from. Trade raises income: Through WTO trade barriers are lowered and this increases imports and exports thus earning the country foreign exchange thus raising the country's income. Trade stimulates economic growth: With upward trend

economic growth, jobs can be created and this can be enhanced by WTO through careful policy making and powers of freer trade. Basic principles make life more efficient: The basic principles make the system economically more efficient and they cut costs Governments are shielded from lobbying: WTO system shields the government from narrow interest. Government is better placed to defend themselves against lobbying from narrow interest groups by focusing on trade-offs that are made in the interests of everyone in the economy. The system encourages good governance: The WTO system encourages good government.

The WTO rules discourage a range of unwise policies and the commitment made to liberalize a sector of trade becomes difficult to reverse. These rules reduce opportunities for corruption. Drawbacks of W.T.O. 1. The WTO Is Fundamentally Undemocratic The policies of the WTO impact all aspects of society and the planet, but it is not a democratic, transparent institution. The WTO rules are written by and for corporations with inside access to the negotiations

. The WTO Will Not Make Us Safer

The WTO would like you to believe that creating a world of "free trade" will promote global understanding and peace. On the contrary, the domination of international trade by rich countries for the benefit of their individual interests fuels anger and resentment that make us less safe. To build real global security, we need international agreements that respect people's rights to democracy and trade systems that promote global justice. 3. The WTO Tramples Labor and Human Rights WTO rules put the "rights" of corporations to profit over human and labor rights. The WTO encourages a 'race to the bottom' in wages by pitting workers against each other rather than promoting internationally recognized labor standards.

4. The WTO Would Privatize Essential Services The WTO is seeking to privatize essential public services such as education, health care, energy and water. 5. The WTO Is Destroying the Environment The WTO is being used by corporations to dismantle hardwon local and national environmental protections, which are attacked as "barriers to trade." 6. The WTO is Increasing Inequality Free trade is not working for the majority of the world. During the most recent period of rapid growth in global trade and investment (1960 to 1998) inequality worsened both internationally and within countries.

7.

The WTO is Killing People The WTO's fierce defense of 'Trade Related Intellectual Property' rights (TRIPs)patents, copyrights and trademarkscomes at the expense of health and human lives. The WTO has protected for pharmaceutical companies' 'right to profit' against governments seeking to protect their people's health by providing lifesaving medicines in countries in areas like sub-saharan Africa, where thousands die every day from HIV/AIDS. Developing countries won an important victory in 2001 when they affirmed the right to produce generic drugs (or import them if they lacked production capacity), so that they could provide essential lifesaving medicines to their populations less expensively. Unfortunately, in September 2003, many new conditions were agreed to that will make it more difficult for countries to produce those drugs. Once again, the WTO demonstrates that it favors corporate profit over saving human lives.

8. The WTO is Increasing Hunger Farmers produce enough food in the world to feed everyone -- yet because of corporate control of food distribution, as many as 800 million people worldwide suffer from chronic malnutrition. 9. The WTO Hurts Poor, Small Countries in Favor of Rich Powerful Nations The WTO supposedly operates on a consensus basis, with equal decision-making power for all. In reality, many important decisions get made in a process whereby poor countries' negotiators are not even invited to closed door meetings -- and then 'agreements' are announced that poor countries didn't even know were being discussed. Many countries do not even have enough trade personnel to participate in all the negotiations or to even have a permanent representative at the WTO.

This severely disadvantages poor countries from representing their interests. Likewise, many countries are too poor to defend themselves from WTO challenges from the rich countries, and change their laws rather than pay for their own defense.
The Tide is Turning Against Free Trade and the WTO!

International opposition to the WTO is growing. Massive protests in Seattle of 1999 brought over 50,000 people together to oppose the WTOand succeeded in shutting the meeting down. When the WTO met in 2001, the Trade negotiators were unable meet their goals of expanding the WTO's reach. The WTO met in Cancn, Mexico this past September 10--14, and met thousands of activists in protest and scoring a major victory for democracy. Developing countries refused to give in to the rich countries' agenda of WTO expansion - and caused the talks to collapse!

Organisation Structure of WTO



The Ministerial Conference is the highest authority. This body is composed of representatives of all WTO members. The day-to-day work of the WTO is entrusted to a number of subsidiary bodies; principally, the General Council, also composed of all WTO memebers, which is required to report to the Ministerial Conference.

The General Council also convenes in two particular forms as the Dispute Settlement body & the Trade Policy review body. The General council delegates responsiblity to three other bodies namely,

the Councils for Trade in Goods, Trade in services, and Trade-related aspects of Intellectural Property rights (TRIPS).

Three other bodies are established by the ministerial conference who report to the General Council. The Committee on Trade & Development The Committee on Balance of Payments The Committee on Budget, Finance and Administration.

TRIPS
One of the most controversial outcomes of the Uruguary round is the agreement on Trade related aspects of intellectual property rights including trade in counterfeit goods.


IPRs may be defined as information with a commercial value. IPRs may be defined as composititon of ideas, inventions & creative expression plus the public willingness to bestow the status of property & give their owners the right to exclude others from access to or use of protected subject matter.