The World Trade Organisation (WTO) can be seen as a number of different things. The first is a global organisation that deals with and monitors the rules of trade between nations, the second is a forum for governments across the world to negotiate trade agreements, and finally, it’s a place to settle trade disagreements. At the epicentre of the WTO lies the WTO agreements, which are negotiated and signed by the majority of the world’s trading nations and endorsed by their parliaments. The ultimate goal of the WTO is to ensure that trade between these nations flows as ‘smoothly, predictably and freely as possible.’
So, when was the WTO created? The World Trade Organisation was formed as a result of the 1986-94 negotiations known as the Uruguay Round negotiations and earlier negotiations under the General Agreement on Tariffs and Trade (GATT) which was established by a multilateral treaty of 23 countries in 1947 after the second World War. At the Uruguay Round negotiations, talks were aimed to extend the trading systems between nations into several new areas, most notably in services and intellectual property and to reform trade in the sensitive sectors of agriculture and textiles. With the final act officially establishing the WTO regime being signed 15th April 1994, known as the Marrakesh Agreement.
Functions of the WTO
Despite the WTO being driven by its member states, there’s no way that it would be able to function without its Secretariat to coordinate and organise the activities which are to be carried out. The Secretariat is made up of over 600 members of staff, including experts in law, the economy, statistics and communications, all of whom assist WTO members on a daily basis to ensure negotiations are conducted smoothly and that rules of trade are correctly applied and enforced. Functions include:
- Trade Negotiations – WTO agreements cover goods, services and intellectual property. These spell out the principles of liberalisation and the exceptions that are allowed. They consist of individual countries’ commitments to lower customs tariffs and other barriers of trade and to open and keep open services markets as well as setting the procedures for settling trade disputes. These agreements, however, are not static. They are renegotiated from time to time where new agreements are added to the package.
- Implementation & Monitoring – WTO agreements require governments to make their trade policies clear by letting the WTO know about laws in force and measures adopted. A number of WTO councils and committees ensure that these requirements are strictly followed and that agreements are properly implemented. Each member of the WTO must undertake occasional scrutiny of their trade policies and processes, each review containing reports by the member state concerned and the WTO Secretariat.
- Dispute Settlement – To ensure that trade between member states of the World Trade Organisation runs smoothly, it is vital that the procedure for resolving trade quarrels are enforced accordingly. Countries bring their disputes to the WTO if they believe their rights under the agreements are being violated. Independent experts are appointed to make judgements based on interpretations of agreements and individual countries’ agreements.
- Building Trade Capacity – WTO agreements include special provisions for developing countries such as measures to increase their trading opportunities, longer time periods to implement agreements and support to enable them to build trade capacity. The World Trade Organisation organises hundreds of technical cooperation missions to developing countries every year. Aid for Trade aims to assist developing countries to develop the infrastructure and skills needed to build their trade.
- Outreach – In order to enhance cooperation and increasing awareness of various WTO activities, the World Trade Organisation conducts regular dialogue and communication with non-governmental organisations, parliamentarians, the media and the general public.
All of these activities are performed for a number of reasons and to achieve several goals, including:
- Non-discrimination between trading counties
- Enabling trade to be more inclusive with lowered barriers
- Creating predictability and transparency of trade to encourage investment
- Increasing competitiveness
- Providing an advantage for developing countries
- Protecting the environment
For more information on the World Trade Organisation, who they are, what they do and what they stand for, be sure to visit the official WTO website below.
World Trade Organisation >