The World Trade Organization By Naina Kamath and Parth Shah
What is the WTO? • WTO stands for World Trade Organization • The WTO "is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments." • "made to help producers of goods and services, exporters, and importers conduct their business."
Origins: • Originated from GATT (General Agreements on Tariffs and Trade) • GATT created the WTO during the Uruguay Round of negotiations. • GATT is a code of regulations while WTO is an institutional organization. • The WTO covers a broader areas like telecommunications, banking, and intellectual property rights.
Dates to remember: • 1947-GATT signed into action • 1986-1994 Uruguay Round negotiations created most of the WTO framework • 1995-WTO created from GATT (75 members joined • 2001-Doha Ministerial Conference created new agreements • 2005-Pascal Lamy became director • 2013-159 members in WTO. along with the 24 observing members
Leadership: • Decisions are made by member governments and "the rules are the outcome of negotiations among members" • Pascal Lamy, a former EU trade commissioner, has been the head of WTO for the past 8 years
Advantages of the WTO • Promotes peace between member nations • Disagreements are handled diplomatically without physical violence • Gives the smaller countries a larger voice • Dramatically decreases the cost of living due to the reduction of protectionist policies such as embargos, tariffs, and quotas • Trade encourages economic growth and increases employment rates • Raises living standards of member nations through economic development
Disadvantages of the WTO • The WTO is too powerful, in that it can in effect compel sovereign states to change laws and regulations by declaring these to be in violation of free trade rules. • The WTO is run by the rich for the rich and does not give significant weight to the problems of developing countries. • Its hearings on trade disputes are closed to the public and the media. • The WTO is indifferent to the impact of free trade on workers' rights, child labour, the environment and health.
International Impact • In general it has helped facilitate trade between countries. All six nations are members of WTO (except for Iran) • The United Kingdom, Nigeria and Mexico are founding members. They have been members since January 1st 1995. • Russia became a member in August 2012 after a lot of debate • China became a member in December 2001 • Iran is currently an observing member
International Impact (Cont.) All 6 countries have had to alter their laws in accordance to WTO regulations. For example, after Russia received membership, it had to lower tariffs, import duties, export duties and allow greater access for foreign companies. In Mexico, WTO membership has hurt the domestic agricultural industry, increased competition and contributed to environmental issues.
International Impact (Cont.) In all 6 countries, there is controversy over how much impact the WTO and its regulations should be permitted to have. Also, WTO membership seems to hurt certain industries, and assist other industries.
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