World Trade Organization

Presented By :

Vibhor Agarwal

Meaning of WTO

“From the money in our pockets andthe goods and services that we use,to a more peaceful world-the WTOand the trading system offers a rangeof benefits, some well-known ,others not so obvious.”

Meaning of WTO

The world trade organization is onlyinternational organization dealing with theglobal rules of the trade between nations. Itsmain function is to ensure that trade flows assmoothly, predictably and freely as possible.

At its heart are the WTO agreements,negotiated and signed by the bulk of theworld's trading nations and ratified in theirparliaments.

Establishment of WTO

It was established on 1st January 1995

As a result of the Uruguay round negotiations (1986-1994)

Located in Geneva, Switzerland

List of member and accession dates

The WTO currently has 160 members. The following table lists all current members and their accessions dates.

Albania 8 September 2000

Angola 23 november 1996

Antigua and Barbuda 1 january 1995

Argentina 1 january 1995

Countries Date of accession

Armenia 5 February 2003

Australia 1 january 1995

Austria 1 january 1995

Bahrain 1 january 1995

Bangladesh 1 january 1995

Barbados 1 january 1995

Countries Date of accession

Belgium 1 january 1995

Belize 1 january 1995

Benin 22 February 1996

Bolivia 12 September 1995

Botswana 31 may 1995

Brazil 1 january 1995

Brunei Darussalam 1 january 1995

Countries Date of accession

Bulgaria 1 December 1996

Burkina Faso 3 June 1995

Burundi 23 July 1995

Cambodia 13 October 2004

Cameroon 13 December 1995

Canada 1 january 1995

Cape Verde 23 July 2008

Central African republic 31 may 1995

Countries Date of accession

Chad 19 October 1996

Chile 1 January 1995

China 11 December 2001

Colombia 30 April 1995

Republic of the Congo 27 march 1997

Democratic republic of the Congo 1 january 1997

Countries Date of accession

Costa rica 1 January 1995

Cote d’Ivoire 1 January 1995

Croatia 30 november 2000

Cuba 20 April 1995

Cyprus 30 July 1995

Czech republic 1 January 1995

Denmark 1 January 1995

Djibouti 31 May 1995

Countries Date of accession

Dominica 1 January 1995

Dominica republic 9 March 1995

Ecuador 21 January 1996

Egypt 30 June 1995

El salvador 7 May 1995

Estonia 13 November 1999

European union 1 January 1995

Fiji 14 January 1996

Countries Date of accession

Finland 1 January 1995

France 1 January 1995

Gabon 1 January 1995

Gambia 23 October 1996

Georgia 14 June 2000

Ghana 1 January 1995

Greece 1 January 1995

Countries Date of accession

Grenada 22 February 1996

Guatemala 21 July 1995

Guinea 25 October 1995

Guinea- bissau 31 May 1995

Guyana 1 January 1995

Haiti 30 January 1996

Honduras 1 January 1995

Hing-kong, china 1 January 1995

Countries Date of accession

Hungary 1 January 1995

Iceland 1 January 1995

India 1 January 1995

Indonesia 1 January 1995

Ireland 1 January 1995

Israel 21 April 1995

Italy 1 January 1995

Jamaica 9 March 1995

Countries Date of accession

Japan 1 January 1995

Kenya 11 April 2000

Republic of korea 1 January 1995

Kuwait 1 January 1995

Kyrgyzstan 1 January 1995

Laos 20 December 1998

Latvia 2 February 2013

Lesotho 10 February 1999

Countries Date of accession

Liechtenstein 31 May 1995

Lithuania 1 September 1995

Luxembourg 31 May 2001

Macau, china 1 January 1995

Republic of macedonia 4 April 2003

Madagascar 17 November 1995

Malawi 31 May 1995

Malaysia 1 January 1995

Countries Date of accession

Maldives 31 May 1995

Mali 31 May 1995

Malta 1 January 1995

Mauritania 31 May 1995

Mauritius 1 January 1995

Mexico 1 January 1995

Moldova 26 July 2001

Mongolia 29 January 1997

Countries Date of accession

Montenegro 29 April 2012

Morocco 1 January 1995

Mozambique 26 August 1995

Myanmar 1 January 1995

Namibia 1 January 1995

Nepal 23 April 2004

Netherlands 1 January 1995

New zealand 1 January 1995

Countries Date of accession

Nicaragua 3 September 1995

Niger 13 December 1996

Nigeria 1 January 1995

Norway 1 January 1995

Oman 9 November 2000

Pakistan 1 January 1995

Panama 6 September 1997

Papua new guinea 9 June 1996

Countries Date of accession

Paraguay 1 January 1995

Peru 1 January 1995

Philippines 1 January 1995

Poland 1 July 1995

Portugal 1 January 1995

Qatar 13 January 1996

Romania 1 January 1995

Russia 22 August 2012

Countries Date of accession

Rwanda 22 May 1996

Saint Kitts and nevis 21 February 1996

Saint lucia 1 January 1995

Saint Vincent and the grenadines

1 January 1995

Samoa 10 May 2012

Saudi arabia 11 December 2005

Senegal 1 January 1995

Countries Date of accession

Sierra leone 23 July 1995

Singapor 1 January 1995

Slovakia 1 January 1995

Slovenia 30 July 1995

Solomon islands 26 July 1996

South africa 1 January 1995

Spain 1 January 1995

Sri lanka 1 January 1995

Countries Date of accession

Suriname 1 January 1995

Swaziland 1 January 1995

Sweden 1 January 1995

Switzerland 1 July 1995

Separate customs territory of Taiwan, Penghu, kinsmen and matsu 1 January 2002

Tajikistan 2 March 2013

Tanzania 1 January 1995

Countries Date of accession

Tanzania 1 January 1995

Thailand 1 January 1995

Togo 31 May 1995

Tongo 27 July 2007

Trinidad and tobago 1 March 1995

Tunisia 29 March 1995

Turkey 26 March 1995

Uganda 1 January 1995

Countries Date of accession

Ukraine 16 May 2008

United Arab emirates 10 April 1996

United kindom 1 January 1995

United states 1 January 1995

Uruguay 1 January 1995

Vanuatu 24 August 2012

Venezuela 1 January 1995

Vietnam 11 January 2007

Countries Date of accession

Yemen 26 June 2014

Zambia 1 January 1995

Zimbabwe 5 march 1995

Countries Date of accession

Evolution of WTO

The Uruguay Round of GATT( 1986-93) gavebirth to WTO.

The members of GATT signed on anagreement of Uruguay Round in April 1994 inMorocco for establishing WTO.

It was officially constituted on Jan 1,1995which took place of GATT as an effectiveformal organization.

Contrary to the temporary nature of GATT,WTO is a permanent organization which hasbeen established on the basis of aninternational treaty approved by participatingcountries.

It achieved the international status like IMFand IBRD, but it is not an agency of the UnitedNations Organization (UNO).

Objectives of WTO

To help trade flow as freely as possible.

To monitor national trade policies.

To ensure optimum utilization of world resources.

To accept the concept of sustainabledevelopment.

To ensure full employment & broad increase ineffective demand.

To enlarge production & trade of goods.

Functions of WTO

Acting as a forum for trade negotiations.

Setting trade disputes.

Administering trade agreements.

Reviewing national trade policies.

Cooperating with other international organization.

Assisting developing countries in trade policy, issues through technical assistance.

How to become a member of WTO?

Article XII of the WTO Agreement states that accession to the WTO will be “on terms to be agreed” between the acceding government and the WTO.

Accession to the WTO is essentially a process of negotiation — quite different from the process of accession to other international entities, like the IMF, which is largely an automatic process.

Because each accession Working Partly takesdecisions by consensus, all interested WTOMembers must be in agreement that theirindividual concerns have been met and thatoutstanding issues have been resolved in thecourse of their bilateral and multilateralnegotiations.All documentation examined by the accessionWorking Party during the process of negotiationremains restricted until completion of theprocess.

Impact of the world trade organization on Indian Economy

The world trade organization was established to deal with all the major aspects of international trade and it had far reaching effects not only on India’s foreign trade but also on its internal economy.

The impact of WTO on the Indian economy can be analyzed on the basis and general concepts.

IMPACT

The WTO has both favorable and non favorable impact on the Indian economy.

FAVOURABLE IMPACT

Increase in export earning:- Increase in export earning can be viewed from growth in merchandise export and growth in service export.

Growth in merchandise export:- The estiblishment of the WTO has increased the export of developing countries because of reduction in tariff and non tariff barriers. India’s merchandise export has increased from 32 billion US dollar (1995) to 185 billion US dollar (2008-2009).

Growth and service export:- WTO introduced the (GATS) General Agreement on Trade in Service that proved beneficial for countries like India, India’s service export increased from 5 billion US dollar (1995) to 102 billion US dollar (2008-2009) software service accounted for 45% of India’s service

Agricultural Exports

Reduction of trade barriers and domestic subsidies rise the price of agricultural product in international market, India hopes to benefit from this in the form of higher export earning from agriculture.

Textile and Clothing

The phasing out of the MFA will largely benefit the textiles sector. It will help the developing countries like India increase the export of textile and clothing.

Foreign Direct Investment

As per the TRIMs agreement, restrictions on foreign investment have been withdrawn by the member nation of the WTO. This has benefited developing country by way of direct investment euro equities and portfolio investment in 2008-2009, the net foreign direct investment in India was 35 billion US dollar.

Unfavorable Impact

1. TRIPs –

Protection of intellectual property rights has been one of the major concerns of the WTO.As a member of the WTO, India has to comply with the TRIPs standards.

However, the agreement on TRIPs goes against the Indian patent act,1970, in the following ways.

PHARMACEUTICAL SECTOR: Under the Indian patent act, 1970 only process patent are grinded to chemicals, drugs and medicines. Thus, a company can legally manufacture once it had the product patent so Indian pharmaceutical companies could sell good quality product(medicines) at low prices.

2. TRIMS: The agreement on TRIMS also favors developed nations as there are no rules in the agreement to formulate international rules for controlling business practices of foreign investors.

3. GATES: The agreement on GATES will also favor the developed nations more. Thus, the rapidly growing service sector in India will now have to compete with giant foreign firms.

4. TRADE AND NON TARRIF BARRIERS: Reduction of trade and non tariff barriers has adversely affected the exports of various developing nations. Various Indian products have been hit by non tariff barriers.

Current WTO Chairperson

Officially, each council committee or working partyelects its own chairperson. However to ensure agood distribution of appointments over all thesebodies, informal conclusions are held to produceconsensus on slates of chairperson in three groups:Those directly involving the General Council(Including the bodies reporting to the tradenegotiating committee). Those reporting to theGoods Council: and those reporting to the servicescouncil.

WTO Chairs Programme

The WCP is advised by the advisory board, and external body composed of experienced scholars. By involving this external body, the WTO seeks to ensure the academic quality of outputs generated by Chair holders.

The WTO chair program was launched in 2010. It aims to enhance knowledge and understanding of the trading system among academics and policies maker in developing countries through curriculum development, research and outreach

activities by universities and research institutions.

Academic institution awarded WTO Chairs receive support in the area of curriculum development, research and outreach activities. The chair holders are selected through a competitive process. 14 institutions were originally selected as WTO chairs for a four-year terms in 2009.

The ministerial conference is the top decision making body of the World Trade Organization(WTO). There have been 9 conferences from 1996-2013, usually every 2 years.

Ninth WTO Ministerial Conference

At the ninth ministerial conference, held in Bali, Indonesia, from 3 to 7 December 2013, ministers adopted the “Bali Package”, a series of decision aimed at streamlining trade, allowing developing countries more options for providing food security, boosting least developed countries’ trade and helping development more generally. They also adopt a number of more routine decision and accepted Yemen as a new member of WTO.

WTO: India against dilution od Doha agenda

New Delhi: Opposing “cherry-picking” of issues by developed countries at WTO, India suggested that there should be no dilution of the stalled Doha development agenda.

Besides, India has said that a permanent solution on the issue of public stock holding for food security purposes was critical and should be addressed on priority basis by the members of World Trade Organization(WTO).

ThankYou