World Trade Organization (WTO)

The WTO is the chief global organization that was formed to deal with the rules and regulations of trade between nations.  Created by the Uruguay Round of trade negotiations (1986-1994) of the GATT (General Agreement on Tariffs and Trade), the WTO was established 1 January 1995, and is made up of 153 nations with others readily pursuing inclusion.  Contact at: World Trade Organization; Centre William Rappard; Rue de Lausanne 154; CH-1211 Geneva 21, Switzerland; Tel: [41] (22) 739-5111; Web: www.wto.org.

WTO Objective.

The WTO’s established purpose is to help trade flow in a predictable, fair, smooth, and free manner.  It ensures this by overseeing WTO trade agreements, acting as an open platform for international trade negotiations, mediating trade disputes, overseeing global trade polices, helping developing nations in trade policy problems that arise by offering technical guidance and training programs, and cooperation with other global entities.

The actions of the WTO are based on the application of fair trading agreements that have been negotiated and implemented by most of the world’s trading nations, and approved by their governments.  These documents are contracts ensuring participating nations crucial trade rights. They also unite governments to align their trade policies within the agreed limits that are the most beneficial to all parties involved.

WTO Structure

The WTO is operated by the affiliated nations.  Any major judgements are made by the group as a whole, either by ministers (who meet every two years at a ministerial conference) or by officials (who meet frequently in Geneva).  Decisions are generally made by majority.

The ministerial conference is permitted to rule on all items that fall under any of the multilateral trade agreements.  Every day work in between the ministerial conferences is managed by three different bodies:

1) The General Council

2) The Dispute Settlement Body

3) The Trade Policy Review Body

All three are called the General Council, even though they meet under different names.

Three more councils, each overseeing a different broad area of trade, report to the General Council. These are:

1) The Council for Trade in Goods (Goods Council)

2) The Council for Trade in Services (Services Council)

3) The Council for Trade-Related Aspects of Intellectual Property (TRIPS Council).

Additional groups report to the General Council.  The area of their purview is more minuscule, so they are called “committees”.  These Committees cover such items as trade and development, the environment, regional trading agreements, investment and competition policy, government procurement, trade facilitation, and others.

Each of the higher-level councils has subordinate bodies.  For example, The Goods Council has 11 committees that handle particular topics such as agriculture, market access, subsidies, anti-dumping, and others.

The most challenging issues are not decided in these upper level councils, but rather in much smaller gatherings with representatives from as many as 40 countries to as few as two countries.

Successes

The WTO (and its predecessor GATT) has been a key player in the following areas: the reduction of tariffs on manufactured goods and agricultural products, the opening of banking, insurance and telecommunications markets to foreign competition, standards for the protection of intellectual property rights, food safety regulations, and bans on local preferences for government purchasing.

Challenges

With all its accomplishments the WTO is challenged by disagreements by member nations to:

1) tariffs- lower or erase tariffs on agricultural, aquaculture, and forest products, scientific, environmental and medical equipment, and chemicals.

2) agricultural subsidies- erase government subsidies to agriculture that set artificially low prices for agricultural products (which is damaging to exporters)

3) intellectual property rights- either fortify intellectual property rights( primarily proposed by more developed western nations that are home to major pharmaceutical companies) or install exemptions from such rules (primarily proposed by more developed nations that desire inexpensive access to drugs to treat HIV/AIDS and other health maladies).

4) environment- establish more strict rules made to protect the environment.

5) services- continue to create opportunities in such service industries as banking, insurance and medical technology, as well as maintain a tax free status on internet commerce.

6) genetically modified food products- give nations, more freedom in their decisions to ban genetically modified food products based on public health or environmental concerns.

7) labor- open a dialogue on how international trade affects labor and possibly to create international labor standards in the areas of child labor, health, and safety issues

8) transperency- make the WTO more transparent by discontinuing covert practices.

World Trade Organization; Centre William Rappard; Rue de Lausanne 154; CH-1211 Geneva 21; Switzerland;

Tel: [41] (22) 739-50-07. WTO Publications: Tel [41] (22)

739-52-08/ 739-53-08.

See General Agreement on Tariffs and Trade, Tokoyo Round, Uruguay Round.

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