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World Trade Organization (WTO)
Multilateral Trading System
Aaisha Makhdum
11th April ,2018
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Scheme of Presentation
Introduction to WTO
– Objectives
– Functions
–Structure
Basic principles of WTO
Single undertaking
WTO Agreements
Strengths and Weaknesses of WTO
Sources
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World Trade Organization (WTO)
International Trade Organization came
into being after the Uruguay Round of
Trade Negotiations on 1st January 1995.
Members 164 Countries (Afghanistan
2016)
23 observer Governments
Secretariat based in Geneva
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WTO Membership
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WTO: Objectives
To raise the standard of living
To ensure full employment
To promote trade in goods & services
To protect and preserve environment
To secure for developing countries &
LDCs a share in international trade for
their economic development
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WTO: Main Functions
Administering & implementing
Multilateral Trade Agreements
Forum for Multilateral Trade Negotiations
Dispute Settlement
Overseeing National Trade Policy
Co-operation with the IMF & World Bank
on global economic policy
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WTO Structure
Ministerial Conference
( 2 years) December 2017 -Buenos Aires
General Council
Dispute Settlement Body
Trade Policy Review Body
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WTO- Coverage
Three major areas :
Trade in Goods –GATT 1948
Trade in Services –GATS
Trade related Aspects of Intellectual
Property Rights –TRIPS Agreement.
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WTO Structure
Councils:
Council for Trade in Goods
Council for Trade in Services(GATS)
Council for Trade Related Aspects of
Intellectual Property Rights(TRIPS)
Committees and other subsidiary bodies
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Basic Principles of WTO
Trade with out discrimination
Freer Trade: through negotiations
Predictability: through binding
&transparency
Promoting fair competition
Encouraging development &economic
reform
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WTO: Trade without discrimination
Most-Favored-Nation (MFN ): Art. I
Members are bound to grant to the
products of other Members treatment not
less favourable than that accorded to the
products of any other country
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WTO: Trade without discrimination
National Treatment: Art. III
Once duties have been paid, imported
goods must be treated no less favourably
than the than the equivalent
domestically-produced goods
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MFN Exceptions
Regional & Free Trade Agreements - applies to
goods traded with members of FTAs and not to
non members outside the agreements
Countries can grant market access to developing
countries –GSP Schemes
Countries can raise barriers against products
that are considered to be traded unfairly from
specific countries –Trade remedy laws
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Predictability
Tariff commitments made by WTO members are
enumerated in a schedule (list) of concessions. These
schedules establish "ceiling bindings": a country can
change its bindings, but only after negotiating with its
trading partners, which could mean compensating them
for loss of trade.
The complaining country may invoke the WTO dispute
settlement procedures.
foreign companies, investors and governments should be
confident that trade barriers (including tariffs and non-
tariff barriers) should not be raised arbitrarily; tariff rates
and market-opening commitments are “bound” in the
WTO 15
Transparency
WTO members are required to publish their trade
regulations, to maintain institutions allowing for the
review of administrative decisions affecting trade, to
respond to requests for information by other members,
and to notify changes in trade policies to the WTO.
These internal transparency requirements are
supplemented and facilitated by periodic country-
specific reports (trade policy reviews) through the Trade
Policy Review Mechanism (TPRM).
WTO system tries also to improve predictability and
stability, discouraging the use of quotas and other
measures used to set limits on quantities of imports.
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Promoting Fair Trade
WTO permit members to take measures
to protect not only the environment but
also public health, animal health and
plant health- TBT ,SPS
Countries can use barriers to restrict
unfair trade –Trade remedy laws
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Trade Negotiations Committee
The Trade Negotiations Committee (TNC) is the
committee that deals with the current trade talks
round. The chair is WTO's director-general.
The WTO describes itself as "a rules-based, member-
driven organization—all decisions are made by the
member governments, and the rules are the outcome
of negotiations among members
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WTO Agreement –single undertaking
Trade in Goods
GATT 1994
Textile & Clothing (ATC)
Agriculture
Trade Related Investment Measures
(TRIMs)
Technical Barriers to Trade (TBT)
Sanitary & Phytosanitary (SPS)
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WTO Agreement –single undertaking
Trade in Goods
Subsidies and Countervailing Measures
Anti-dumping
Safeguards
Preshipment Inspection
Customs Valuation
Rules of Origin
Import Licensing
Trade Facilitation -2015
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STRENGTHS OF WTO
All Countries have equal vote
Decisions by Consensus
Transparent Rules & Decision Making
Effective Dispute Settlement System
Wide Coverage (Goods, Services, IPR)
Development Provisions
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WEAKNESSES OF WTO
Undefined areas such as Labour,
Environment, Investment.
Slow decision making in Negotiations
High Cost of Dispute Settlement
Vague Development Provisions
Distorted Image
Clashing Trade Interests
Regional Trade Agreements
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Sources
www.wto.org
www.wipo.org
www.unctad.org
www.itc.org
www.fao.org
www.ictsd.org
www.commerce.gov.pk
www.ntc.gov.pk
www.ipo.gov.pk
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Thank you
Q&A
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