Lecture Notes on

International Trade

WTO

Economic
Institutions

Presentation
on

WTO

(World Trade Organization)

In Brief
7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade
Formation
Headquarters
Membership
Officiallanguages
Director-General
Budget
Staf
Website

7/23/16

Economic
Institutions
1 January 1995
Centre William Rappard,
Geneva, Switzerland
159 member states
English, French, Spanish
Pascal Lamy
196 millionSwiss
francs(approx. 209 million
US$) in 2011.
640
wto.org

WTO

WTO
at
a glance
By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

the World Trade Organization (WTO) is the

only international organization dealing with
the global rules of trade between nations.
Its main function is to ensure that trade
flows as smoothly, predictably and freely as
possible.

7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

Evolution of the WTO

WTO was established on 1st January 1995. In April 1994, the Final Act was signed at a
meeting in Marrakesh, Morocco. The Marrakesh Declaration of 15th April 1994 was formed to
strengthen the world economy that would lead to better investment, trade, income growth and
employment throughout the world. The WTO is the successor to the General Agreement of
Tariffs and Trade (GATT). India is one of the founder members of WTO. WTO represents the
latest attempts to create an organisational focal point for liberal trade management and to
consolidate a global organisational structure to govern world affairs. WTO has attempted to
create various organisational attentions for regulation of international trade. WTO created a
qualitative change in international trade. It is the only international body that deals with the
rules of trades between nations.
7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

The Uruguay Round (1986-1994)

The results of the Uruguay Round (UR) were signed in Marrakech, Morocco on 15 April
1994 .The WTO came into being on 1 January 1995 by virtue of the Agreement establishing the
WTO.
The scope of the multilateral trading system was broadened from trade in goods (GATT) to
encompass trade in services (GATS) and trade related aspects of intellectual property rights
(TRIPS). It was a rule-based global trading system complete with its own dispute resolution
procedures .
The Single Undertaking concept
The multilateral trade agreements under the WTO system are treated as a single undertaking
which means that every member state of the WTO is a party to every one of these agreements
and must implement them accordingly.
7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

Functions of WTO
The former GATT was not really an organisation; it was merely a legal arrangement. On the
other hand, the WTO is a new international organisation set up as a permanent body. It is
designed to play the role of a watchdog in the spheres of trade in goods, trade in services,
foreign investment, intellectual property rights, etc. Article III has set out the following five
functions of WTO;
(i) The WTO shall facilitate the implementation, administration and operation and further the
objectives of this Agreement and of the Multilateral Trade Agreements, and shall also provide
the frame work for the implementation, administration and operation of the plurilateral Trade
Agreements.
7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

Functions of WTO

(ii) The WTO shall provide the forum for negotiations among its members concerning their
multilateral trade relations in matters dealt with under the Agreement in the Annexes to this
Agreement.
(iii) The WTO shall administer the Understanding on Rules and Procedures Governing the
Settlement of Disputes.
(iv) The WTO shall administer Trade Policy Review Mechanism.
(v) With a view to achieving greater coherence in global economic policy making, the WTO
shall cooperate, as appropriate, with the international Monetary Fund (IMF) and with the
International Bank for Reconstruction and Development (IBRD) and its affiliated agencies

7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

Objectives of WTO
Important objectives of WTO are mentioned below:
(i) to implement the new world trade system as visualised in the Agreement;
(ii) to promote World Trade in a manner that benefits every country;
(iii) to ensure that developing countries secure a better balance in the sharing of the
advantages resulting from the expansion of international trade corresponding to their
developmental needs;
(iv) to demolish all hurdles to an open world trading system and usher in international
economic renaissance because the world trade is an effective instrument to foster economic
growth;
By Komal Singh
7/23/16

Chauhan

Assist. Prof. VCMT Bijnor UP

Lecture Notes on
International Trade

Economic
Institutions

WTO

Objectives of WTO
(v) to enhance competitiveness among all trading partners so as to benefit consumers and
help in global integration;
(vi) to increase the level of production and productivity with a view to ensuring level of
employment in the world;
(vii) to expand and utilize world resources to the best;
(viii) to improve the level of living for the global population and speed up economic
development of the member nations.

7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

Structure of
WTO
7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

The Ministerial Conference (MC) is at the top of the structured organization of the WTO. It
is the supreme governing body which takes ultimate decisions on all matters. It is constituted
by representative (usually, Ministers of Trade) all the member countries.
The General Council (GC) is composed of the representatives of all the members. It is the
real engine of WTO which acts on behalf of the MC. It also acts as the Dispute Settlement
Body as well as the Trade Policy Review Body.
There are three councils viz : the Council for Trade Related Aspects of Intellectual
Property Rights (TRIPS) operating under the GC. These councils with their subsidiary bodies
carry out their specific responsibilities.

7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

Further there are three committee, viz, the committee on Balance of Payments
Restrictions (CBOPR) and the committee o Budget, Finance and Administration (CFBA)
which execute the functions assigned to them by the WTO Agreement and the GC.
The Administration of the WTO is conducted by the Secretariat which is headed by the
Director General (DG) appointed by the MC for the tenure of four years. He is assisted by
the four Deputy Directors from different member countries. The annual budget estimates
and financial statement of the WTO are presented by the DG to the CBFA for reivew and
recommendations for the final approval by the GC.

7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

WTO: Benefits for business

Creation of a stable, rule based, multilateral trading regime
Market access translates into market opportunities
The rule based system creates certain rights of access
- Security of access
tariff bindings and disciplines on barriers to trade whether tariff or non tariff. It also provides non
discriminatory treatment of products and services.

- Stability of access
etc.

the application of uniform rules in key areas of the trading process e.g. customs valuation, import licenses

- Rights against unfair trade practices for

Domestic industry
Export industry
7/23/16
Import
industry

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

Economic
Institutions

WTO

WTO
Members
hip
Members
Observer

Newest Members
Tajikistan 2 March 2013

7/23/16

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan

Lecture Notes on
International Trade

7/23/16

Economic
Institutions

WTO

By Komal Singh
Assist. Prof.
VCMT Bijnor UP
Chauhan