Gatt Presentation

Difference Between GATT and WTO GATT

WTO

GATT was adhoc and provisional

WTO and its agreements are permanent

GATT has contracting parties

WTO has members

GATT system allowed existing domestic legislation to continue even if violated a GATT agreement

WTO does not permit this

GATT was less powerful, dispute settlement system slow and less efficient, its ruling could be easily blocked

WTO is more powerful than GATT, dispute settlement mechanism in faster and more efficient, very difficult to block the run buys

Dealt with trade in goods

WTO agreements cover trade in goods, services and intellectual property rights 1

Organizational Structure • Decision in WTO are made by the entire membership – consensus • Ministerial Conference WTO’s top level decision – making body is the Ministerial Conference which meets at least once in every two years. • General Council It is constituted by ambassadors and heads of delegation in Geneva. Some times officials are sent from members’ capitals. They meet several times a year in the Geneva Headquarters. The general council also meets the Trade Policy Review body and the Dispute Settlement body. • Goods council, Services council and Intellectual Property (TRIPs) Council – These councils report to the general council • Specialised Committees, working groups and working parties The committees deal with the individual agreements and other areas such as the environment, development, membership applications and regional trade 2 agreements.

GATS •

The General Agreement on Trade in Services (GATS) which extends multilateral rules and disciplines to services in regarded as landmark achievement of the UR.

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Because of the special characteristics and the socio-economic and political implications of certain services, they have been generally subject to various types of national restrictions.

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Protection measures include visa requirements, investment regulation, restriction on repatriation, marketing regulations, restrictions on employment of foreigners, compulsions to use local facilities etc.

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Heavily protected services in different countries include banking and insurance, transportations, television, radio, film and other forms of communication

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Mode of Services GATS cover four modes of international delivery of services. 3.

Cross-border Supply (transborder data flow, transportation services)

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Commercial presence (provision of services abroad through FDI or representative offices)

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Consumption abroad (tourism)

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Movement of personnel (entry and temporary stay of foreign consultants)

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Industrial countries have offered market access commitment to about 54% services.

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Developing countries opened for 17% of services

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Tourism & travel related services are the only activities in which a substantial number of developing countries made commitments. 4

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Fear of developing countries is that the liberalization of trade in services will lead to the domination of the services sector of the developing countries by the multinationals of the industrial countries.

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Although many services are labour intensive and therefore, the developing countries should be expected to have an advantage, but there have been several constraints in benefiting from this advantage.

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Immigration laws of developed countries restrict the manpower flow from the developing to developed countries. This severely limits the scope of developing countries in benefiting from the comparative advantage.

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Industrial countries, that’s why did not like to bring this issue in the Uruguay Round

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