World trade organisation

  International organizations and movements. Their role in the promotion of
             peace, global cooperation and mutual understanding

                          WORLD TRADE ORGANISTAION

    Matveev Andrey 11 “A”
    Center of Education №1816

                          WORLD TRADE ORGANISATION

    Nobody will deny if I say that in our modern world it is very important
to  control  the  relationship  between  different  countries.   There   are
different organizations nowadays. They  control  different  aspects  of  our
everyday life. I would like to speak  about  world  trade  organization.  It
deals with the global rules of trade between nations. Its main  function  is
to ensure that trade flows as smoothly, predictably and freely as possible.
    First of all I would like to give some facts about the creation and
location of WTO.

    Location: Geneva, Switzerland
    Established: 1 January 1995
    Created by: Uruguay Round negotiations (1986–94)
    Membership: 134 countries (as of February 1999)
    Budget: 122 million Swiss francs for 1999
    Secretariat staff: 500
    Head: Director-general
    • Administering WTO trade agreements
    • Forum for trade negotiations
    • Handling trade disputes
    • Monitoring national trade policies
    • Technical assistance and training for developing countries
    • Cooperation with other international organizations

    The World Trade Organization came  into  being  in  1995.  One  of  the
youngest of the international organizations, the WTO  is  the  successor  to
the General Agreement on Tariffs and Trade (GATT) established  in  the  wake
of the Second World War. So while the WTO is still young,  the  multilateral
trading system that was originally set up under GATT  is  already  50  years
old. The system celebrated its golden jubilee in  Geneva  on  19  May  1998,
with many heads of state and  government  leaders  attending.  The  past  50
years have seen an exceptional growth in world  trade.  Merchandise  exports
grew on average by 6% annually. Total trade in 1997 was 14-times  the  level
of 1950. GATT and the WTO have helped to  create  a  strong  and  prosperous
trading  system  contributing  to  unprecedented  growth.  The  system   was
developed through a series of trade  negotiations,  or  rounds,  held  under
GATT. The first  rounds  dealt  mainly  with  tariff  reductions  but  later
negotiations included  other  areas  such  as  anti-dumping  and  non-tariff
measures. The latest round—the  1986-94.  Uruguay  Round—led  to  the  WTO’s
creation. The negotiations did not end there. Some continued after  the  end
of  the  Uruguay  Round.  In  February  1997  agreement   was   reached   on
telecommunications services, with 69 governments  agreeing  to  wide-ranging
liberalization measures that went beyond those agreed in the Uruguay  Round.
In the same year 40  governments  successfully  concluded  negotiations  for
tariff-free  trade  in  information  technology  products,  and  70  members
concluded a financial services deal covering  more  than  95%  of  trade  in
banking, insurance, securities and financial information. At  the  May  1998
ministerial meeting in Geneva, WTO members  agreed  to  study  trade  issues
arising from global electronic commerce. The next ministerial conference  is
due to be held in the United States in late 1999. In  2000,  new  talks  are
due to start on agriculture and services  and  possibly  a  range  of  other

    The WTO’s overriding objective is to help trade flow smoothly,  freely,
fairly and predictably. It does this by:
    • Administering trade agreements
    • Acting as a forum for trade negotiations
    • Settling trade disputes
    • Reviewing national trade policies
    • Assisting  developing  countries  in  trade  policy  issues,  through
technical assistance and training programs
    • Cooperating with other international organizations

    The WTO has more than 130 members, accounting for  over  90%  of  world
trade. Over 30 others are negotiating membership. Decisions are made by  the
entire membership. This is typically by consensus. A majority vote  is  also
possible but it has never been used in  the  WTO,  and  was  extremely  rare
under the WTO’s predecessor, GATT. The WTO’s agreements have  been  ratified
in all members’ parliaments. The WTO’s top  level  decision-making  body  is
the Ministerial Conference which meets at least once every two years.  Below
this is the General Council (normally ambassadors and  heads  of  delegation
in Geneva, but sometimes officials sent from members’ capitals) which  meets
several times a year in the Geneva headquarters. The  General  Council  also
meets as the Trade Policy Review Body and the Dispute  Settlement  Body.  At
the next  level,  the  Goods  Council,  Services  Council  and  Intellectual
Property  (TRIPS)  Council  report  to   the   General   Council.   Numerous
specialized committees, working groups and working  parties  deal  with  the
individual agreements and other areas such as the environment,  development,
membership  applications  and   regional   trade   agreements.   The   first
Ministerial Conference in Singapore in 1996 added three new  working  groups
to this structure.  They  deal  with  the  relationship  between  trade  and
investment,  the  interaction  between  trade  and  competition  policy  and
transparency  in  government  procurement.   At   the   second   Ministerial
Conference in Geneva in 1998 ministers  decided  that  the  WTO  would  also
study the area of electronic  commerce,  a  task  to  be  shared  out  among
existing councils and committees.

    The WTO Secretariat, based in Geneva,  has  around  500  staff  and  is
headed by a director-general.  It  does  not  have  branch  offices  outside
Geneva.  Since  decisions  are  taken  by  the   members   themselves,   the
Secretariat does not have the decision-making role that other  international
bureaucracies are  given.  The  Secretariat’s  main  duties  are  to  supply
technical  support  for  the  various  councils  and  committees   and   the
ministerial conferences, to  provide  technical  assistance  for  developing
countries, to analyze world trade, and to explain WTO affairs to the  public
and media.
    The Secretariat also provides some forms of  legal  assistance  in  the
dispute  settlement  process  and  advises  governments  wishing  to  become
members of the WTO.
    The annual budget is roughly 122 million  Swiss  francs.  How  can  you
ensure that trade is as fair as possible, and as free as  is  practical?  By
negotiating rules and abiding by them. The  WTO’s  rules—the  agreements—are
the result of negotiations between the members. The  current  set  were  the
outcome of the 1986–94 Uruguay Round negotiations  which  included  a  major
revision of the original General Agreement  on  Tariffs  and  Trade  (GATT).
GATT is now the WTO’s principal rule-book for trade in  goods.  The  Uruguay
Round also created new rules for dealing with trade  in  services,  relevant
aspects of intellectual  property,  dispute  settlement,  and  trade  policy
reviews. The complete set runs to some 30,000 pages consisting of  about  60
agreements and separate commitments (called schedules)  made  by  individual
members in specific areas such as lower  customs  duty  rates  and  services
market-opening.  Through  these  agreements,  WTO  members  operate  a  non-
discriminatory trading  system  that  spells  out  their  rights  and  their
obligations. Each country receives  guarantees  that  its  exports  will  be
treated fairly and consistently in other. These  principles  appear  in  the
new General Agreement on Trade in Services (GATS).  WTO  members  have  also
made individual commitments under  GATS  stating  which  of  their  services
sectors they are willing to open to foreign competition, and how open  those
markets are. countries’ markets. Each promises to do the  same  for  imports
into its own  market.  The  system  also  gives  developing  countries  some
flexibility in implementing their commitments.

    It all began with trade in goods. From 1947 to 1994, GATT was the forum
for negotiating lower customs duty rates and other trade barriers; the  text
of  General  Agreement  spelt  out  important   rules,   particularly   non-
discrimination. Since 1995, the updated GATT has become the  WTO’s  umbrella
agreement for trade in goods. It has annexes dealing with  specific  sectors
such as agriculture and textiles, and with specific  issues  such  as  state
trading, product standards, subsidies and actions taken against dumping.

    Banks, insurance firms, telecommunications companies,  tour  operators,
hotel chains and transport companies looking to do business abroad  can  now
enjoy the same principles of freer and fairer  trade  that  originally  only
applied to trade in goods.

    The WTO’s intellectual property agreement amounts to  rules  for  trade
and investment in ideas and creativity.  The  rules  state  how  copyrights,
trademarks,  geographical  names  used  to  identify  products,   industrial
designs, integrated circuit layout-designs and undisclosed information  such
as trade secrets—“intellectual property”—should be protected when  trade  is

    The WTO’s procedure for resolving  trade  quarrels  under  the  Dispute
Settlement Understanding is vital for enforcing the rules and therefore  for
ensuring that trade flows smoothly. Countries bring disputes to the  WTO  if
they think their rights under the agreements are being infringed.  Judgments
by specially-appointed independent experts are based on  interpretations  of
the agreements and individual countries’ commitments. The system  encourages
countries to settle their differences through  consultation.  Failing  that,
they can follow  a  carefully  mapped  out,  stage-by-stage  procedure  that
includes the possibility of a ruling by a panel of experts, and  the  chance
to appeal the ruling on legal grounds. Confidence in  the  system  is  borne
out by the number of cases brought  to  the  WTO—167  cases  by  March  1999
compared to some 300 disputes dealt with during  the  entire  life  of  GATT

    The Trade Policy Review Mechanism’s purpose is to improve transparency,
to create a  greater  understanding  of  the  policies  that  countries  are
adopting, and to assess their impact. Many members also see the  reviews  as
constructive feedback on  their  policies.  All  WTO  members  must  undergo
periodic scrutiny, each review containing reports by the  country  concerned
and the WTO Secretariat. Over 54 members have been reviewed  since  the  WTO
came into force.

    Over three quarters of WTO members are  developing  or  least-developed
countries. Special provisions for these members are included in all the  WTO
agreements. They include longer time  periods  for  implementing  agreements
and commitments,  measures  to  increase  trading  opportunities  for  these
countries, provisions requiring all  WTO  members  to  safeguard  the  trade
interests of developing countries, and support to help developing  countries
build the infrastructure  for  WTO  work,  handle  disputes,  and  implement
technical standards. In 1997, a high-level meeting on trade initiatives  and
technical assistance for least-developed countries  brought  their  concerns
to centre stage. The meeting involved  six  intergovernmental  agencies  and
resulted in an “integrated  framework”  to  help  least-developed  countries
increase their ability to trade, and  some  additional  preferential  market
access agreements. A committee on trade and development, assisted by a  sub-
committee on  least-developed  countries,  looks  at  developing  countries’
special  needs.  Its   responsibility   includes   implementation   of   the
agreements,  technical  cooperation,  and  the  increased  participation  of
developing countries in the global trading system

    The  WTO  organizes  around  100  technical  cooperation  missions   to
developing countries annually.  It  holds  on  average  three  trade  policy
courses each year in Geneva for government officials. Regional seminars  are
held regularly in all regions of  the  world  with  a  special  emphasis  on
African countries.  Training  courses  are  also  organized  in  Geneva  for
officials from countries in  transition  from  central  planning  to  market
economies. In 1997/98, the WTO set up reference centers  in  over  40  trade
ministries in capitals of  least-developed  countries,  providing  computers
and internet access to enable ministry officials to keep abreast  of  events
in the WTO in Geneva through online access to the WTO’s immense database  of
official documents and other material.