Wto

World Trade Organization Unfolding the One World Story

Class of PGDM 2008-

History Old wine in a new bottle ØThe idea of WTO was conceptualized in Bretton Woods Conference in 1944, along with World Bank and IMF. ØInternational Trade Organization (ITO) Charter was rectified to form an interim arrangement in the form of GATT (1948). ØFinally born, on 1st August, 1994 and came into act from 1st January, 1995.

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The Uruguay Round ØUruguay Round (UR) was negotiations held in Sept ’86.

the

8thround

of

multi-lateral

trade

ØDue to the conflicting issues UR could not be concluded in Dec ‘90 as scheduled. ØArthur Dunkel, the then Director General of GATT presented a draft act, popularly known as Dunkel Draft. ØDunkel Draft was replaced by an enlarged and modified final text was approved by 125 Governments on 15th April 1994. ØThis Draft led to the formation of WTO. An organization that was conceptualized 50 years back.

Class of PGDM 2008-10

Class of PGDM 2008-10

Functions of WTO The WTO has 5 specific functions. c) The WTO shall facilitate the implementation, administration and operation of multi-lateral and pluri-lateral trade agreements. e) The WTO shall administer the Trade Review Mechanism. g) The WTO shall provide the forum for negotiation among the members concerning the multi-lateral trades. i) The WTO shall administer the understanding on rules and procedures governing the settlement of disputes. k) With a view to achieve greater coherence in Global Economic Policy making the WTO shall co-operate with IMF, IBRD and its affiliated agencies.

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GATT to WTO – A half a century Journey WTO

GATT

ØWTO and its agreement are permanent

ØGATT was provisional

ØWTO has members

ØGATT had contracting parties.

ØWTO is more powerful than GATT

ØGATT allowed legislative purview.

ØDispute settlement mechanism faster and efficient.

ØGATT was less powerful, dispute settlement slow and inefficient.

ØVery

difficult

to

block

Ad-Hoc

and

domestic

its Class of PGDM 2008-10

WTO and Developing Countries 1 WTO provides a window for gradual roll-out of TRIPS and IPR regulations. 3 Provision for regional trade blocks. 5 The principles of Non-discrimination, transparency, increased certainty, trade facilitation and protection from monopolistic competition.

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WTO and India 1 India’s trade gain. 3 Competitive advantage due to WTO. 5 Potential of becoming a knowledge hub due to CBD (Connection on Biological Diversity) and better IPR protection. 7 FDI and MNC Exposure. 9 India getting a platform to showcase its talent

“Seattle is Bangalored…”

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WTO and Agriculture ØBlue Box, Green Box and Amber Box Subsidy ØDumping and Tariff Barrier. ØQuarantine Barriers. ØMango Vs. Harley Davidson. Class of PGDM 2008-10

Ministerial Round and Present Deadlock 1 Ministerial Conference is the highest body of WTO. 3 Due to conflict of interests between developed and emerging nations, especially in-terms of agricultural subsidies last few ministerial conferences have failed miserably. 5 BRIC and MERCOSUR trade blocks are building another axis of power apart from Euro and US

Class of PGDM 2008-10

Evaluation of WTO Benefits of WTO: 3

WTO has made significant achievements in reducing the Tariff and Non-Tariff Barrier.

5

The liberalization of investments had been fostering economic growth of a number of countries.

7

WTO provides a forum for multi-lateral discussions of economic relations between nations.

9

It has a system to settle trade disputes between nations.

11 Malta to Morocco, Stockholm to Shanghai World on one platform .

Class of PGDM 2008-10

Evaluation of WTO Criticism: 3

Negotiations and Decision making in WTO dominated by Developed Countries.

5

Most Developing Countries do not have the Financial and Knowledge resources to effectively participate in the WTO discussions and negotiations.

6

Due to the dependence of Developing Countries on the Developed ones, the Developed countries are able to resort to arm-twisting techniques.

8

The WTO has not been successful to impose the organizational disciplines on the Developed Nations.

10 Sub-Saharan, Third World and OECD countries are becoming new Colonies- Thanks to WTO.

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DOHA round ØIt is the current round of negotiations started in November 2001. ØAn ambitious effort to make globalisation more inclusive and help the world's poor. ØThe Ministerial attracted a lot of attention, due to conflicts between the developing and developed countries. ØThe multilateral trading system embodied in the World Trade Organization has contributed significantly to economic growth, development and employment throughout the past fifty years. ØThe TRIPS Agreement does not and should not prevent Members from taking measures to protect public health. Members can set aside the patent laws if they have to face epidemics ØThe talks have been highly contentious and agreement has Class of PGDM 2008-10

Cancun to Singapore

Go Back Go Back…!!! Class of PGDM 2008-10