Created in 1995, the World Trade Organization (WTO) is an international institution that oversees the rules for global trade among nations. It superseded the 1947 General Agreement on Tariffs and Trade (GATT) created in the wake of World War II. The WTO is based on agreements signed by a majority of the world’s trading nations. The main function of the organization is to help producers of goods and services, as well as exporters and importers, protect and manage their businesses. As of 2021, the WTO has 164 member countries, with Liberia and Afghanistan the most recent members, having joined in July 2016, and 25 “observer” countries and governments.
The WTO is essentially an alternative dispute or mediation entity that upholds the international rules of trade among nations. The organization provides a platform that allows member governments to negotiate and resolve trade issues with other members. The WTO’s main focus is to provide open lines of communication concerning trade among its members. The WTO has lowered trade barriers and increased trade among member countries. It also has also maintained trade barriers when it makes sense to do so in the global context. The WTO attempts to mediate between nations in order to benefit the global economy. Once negotiations are complete and an agreement is in place, the WTO offers to interpret the agreement in case of a future dispute. All WTO agreements include a settlement process that allows it to conduct neutral conflict resolution. On Feb. 15, 2021, the WTO’s General Council selected two-time Nigerian finance minister Ngozi Okonjo-Iweala as its director-general. She is the first woman and the first African to be selected for the position. She took office on March 1, 2021, for a four-year term. No negotiation, mediation, or resolution would be possible without the foundational WTO agreements. These agreements set the legal ground-rules for international commerce that the WTO oversees. They bind a country’s government to a set of constraints that must be observed when setting future trade policies. The agreements protect producers, importers, and exporters while encouraging world governments to meet specific social and environmental standards.
In recent years, the U.S. relationship with the WTO has been cool. The feeling is that the WTO is not doing enough to counteract China's unfair trade practices. The history of international trade has been a battle between protectionism and free trade, and the WTO has fueled globalization, with both positive and adverse effects. The organization’s efforts have increased global trade expansion. There are side effects to globalization, including a negative impact on local communities and human rights. Proponents of the WTO, particularly multinational corporations, believe that the organization is beneficial to business, seeing the stimulation of free trade and a decline in trade disputes as beneficial to the global economy. Skeptics believe that the WTO undermines the principles of organic democracy and widens the international wealth gap. They point to the decline in domestic industries and increasing foreign influence as negative impacts on the world economy. As part of his broader attempts to renegotiate U.S. international trade deals, when he was in office, then-President Donald Trump threatened to withdraw from the WTO, calling it a “disaster.” A U.S. withdrawal from the WTO could have disrupted trillions of dollars in global trade. However, he didn’t withdraw the U.S. from the WTO during his time in office.
The World Trade Organization (WTO) is the body that keeps global trade running smoothly. It oversees the rules and mediates disputes among its member nations. It now has 164 member nations and 25 observer nations (out of a total 195 nations in the world).
The World Trade Organization (WTO) administers the trade agreements made among its member nations. It also mediates any trade disputes that arise.
The U.S. has been a member of the WTO since 1995 and signed its General Agreement on Tariffs and Trade (GATT) in 1948. In 1999, then-President Bill Clinton facilitated the acceptance of China into the WTO. The impact on China and on the world continues to be debated to this day. back to top There are a number of ways of looking at the WTO. It’s an organization for liberalizing trade. It’s a forum for governments to negotiate trade agreements. It’s a place for them to settle trade disputes. It operates a system of trade rules. (But it’s not Superman, just in case anyone thought it could solve — or cause — all the world’s problems!) Above all, it’s a negotiating forum … Essentially, the WTO is a place where member governments go, to try to sort out the trade problems they face with each other. The first step is to talk. The WTO was born out of negotiations, and everything the WTO does is the result of negotiations. The bulk of the WTO's current work comes from the 1986-94 negotiations called the Uruguay Round and earlier negotiations under the General Agreement on Tariffs and Trade (GATT). The WTO is currently the host to new negotiations, under the “Doha Development Agenda” launched in 2001. Where countries have faced trade barriers and wanted them lowered, the negotiations have helped to liberalize trade. But the WTO is not just about liberalizing trade, and in some circumstances its rules support maintaining trade barriers — for example to protect consumers or prevent the spread of disease. It’s a set of rules … At its heart are the WTO agreements, negotiated and signed by the bulk of the world’s trading nations. These documents provide the legal ground-rules for international commerce. They are essentially contracts, binding governments to keep their trade policies within agreed limits. Although negotiated and signed by governments, the goal is to help producers of goods and services, exporters, and importers conduct their business, while allowing governments to meet social and environmental objectives. The system’s overriding purpose is to help trade flow as freely as possible — so long as there are no undesirable side-effects — because this is important for economic development and well-being. That partly means removing obstacles. It also means ensuring that individuals, companies and governments know what the trade rules are around the world, and giving them the confidence that there will be no sudden changes of policy. In other words, the rules have to be “transparent” and predictable. And it helps to settle disputes … This is a third important side to the WTO’s work. Trade relations often involve conflicting interests. Agreements, including those painstakingly negotiated in the WTO system, often need interpreting. The most harmonious way to settle these differences is through some neutral procedure based on an agreed legal foundation. That is the purpose behind the dispute settlement process written into the WTO agreements. Born in 1995, but not so young back to topThe WTO began life on 1 January 1995, but its trading system is half a century older. Since 1948, the General Agreement on Tariffs and Trade (GATT) had provided the rules for the system. (The second WTO ministerial meeting, held in Geneva in May 1998, included a celebration of the 50th anniversary of the system.) It did not take long for the General Agreement to give birth to an unofficial, de facto international organization, also known informally as GATT. Over the years GATT evolved through several rounds of negotiations. The last and largest GATT round, was the Uruguay Round which lasted from 1986 to 1994 and led to the WTO’s creation. Whereas GATT had mainly dealt with trade in goods, the WTO and its agreements now cover trade in services, and in traded inventions, creations and designs (intellectual property).
... OR IS IT A TABLE? Participants in a recent radio discussion on the WTO were full of ideas. The WTO should do this, the WTO should do that, they said. One of them finally interjected: “Wait a minute. The WTO is a table. People sit round the table and negotiate. What do you expect the table to do?”
‘Multilateral’ trading system ... ... i.e. the system operated by the WTO. Most nations — including almost all the main trading nations — are members of the system. But some are not, so “multilateral” is used to describe the system instead of “global” or “world”. In WTO affairs, “multilateral” also contrasts with actions taken regionally or by other smaller groups of countries. (This is different from the word’s use in other areas of international relations where, for example, a “multilateral” security arrangement can be regional.) |
In what ways do you think the WTO is still essential to global trade
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