Short description on WTO including objective,reference to India, agriculture boxes

1. World Trade
Organization.
Presentation by –
Avi Vani

2. Outlineof thePresentation
•The Agreements:
1. General Agreement on Tariffs and
Trade (GATT) – Agriculture, non-Agricultural
market access
2. General Agreement on Trade in
services (GATS)
3. Trade Related Aspects of Intellectual
Property rights
•Dispute Settlement, Aid for trade, The Doha Development
Agenda

3. Introduction to WTO
• An organization for liberalizing trade, which deals with the rules of
trade between nations at a global or near-global level
• Location: Geneva, Switzerland
• Established: 1 January 1995
• Created by: Uruguay Round Negotiations (1986–94)
• Membership: 164 countries on accounting for over 98% of world
trade.
• Budget: 189 million Swiss francs for 2009
• Secretariat staff: 625
• Head: Roberto Azevêdo (Director-General). He was
appointed on 1 September 2013.

5. Goalsand objectives
• The ultimate goal is to improve the welfare of the peoples of the
member countries.
• The WTO’s overriding objective is to help trade flow smoothly, freely,
fairly and predictably.
• It does this by:
* Administering trade agreements
* Acting as a forum for trade negotiations
* Settling trade disputes
* Reviewing national trade policies
* Assisting developing countries in trade policy issues,
through technical assistance and training programs
* Cooperating with other international organizations

6. •A Forum where member countries met from
time to time to discuss & solve world trade
problems .
•It Enjoys identical legal status , privileges ,
Immunities that the world bank & IMF get .

8. History – from GATTto WTO
• WTO is the successor to the General Agreement on Tariffs and Trade
(GATT) originated in 1947.
• After ending of the second World War, the two “Bretton Woods”
institutions, the World Bank and the International Monetary Fund was
established. At that time the idea was to create a third organization to
handle the trade side of international economic cooperation.
• The draft charter of International Trade Organization (ITO) was too
ambitious. – Included only trade issues, but rules on employment,
commodity agreements, restrictive business practices, international
investment, and services.

9. •Even before starting the negotiation for an
ITO, a smaller group of countries (15) had
started negotiation in December 1945, to
reduce and bind customs tariffs.
•They wanted to give an early boost to trade
liberalization, and to begin to correct the
legacy of protectionist measures which
remained in place from the early 1930s.

10. BASIS FOR
COMPARISON
GATT WTO
Meaning GATT can be described as a set
of rules, multilateral trade
agreement, that came into
force, to encourage
international trade and remove
cross-country trade barriers.
WTO is an international
organization, that came into
existence to oversee and
liberalize trade between
countries.
Institution It does not have any
institutional existence, but
have a small secretariat.
It has permanent institution
along with a secretariat.
Participant nations Contracting parties Members
Commitments Provisional Full and Permanent
Application The rules of GATT are only for
trade in goods.
The rules of WTO includes
services and aspects of
intellectual property along with

11. Agreement Its agreement are
originally
multilateral, but
plurilateral
agreement are
added to it later.
Its agreements
are purely
multilateral.
Domestic
Legislation
Allowed to
continue
Not allowed to
continue
Dispute
Settlement
System
Slow and
ineffective
Fast and effective

12. FUNCTIONS OFWTO
Administering WTO trade agreements
Forum for trade negotiations
Handling trade disputes
Monitoring national trade policies
Technical assistance and training for
developing countries
Cooperation with other international
organizations

13. TRIMS, ANDTRIPS OFWTO
1) Agreement on Trade-Related Investment Measures (TRIMs)
TRIMs refers to certain conditions or restrictions imposed by a
governments in respect of foreign investment in the country
The agreement on TRIMs provides that no contracting party shall
apply any TRIM which is inconsistent with the WTO Articles.
2) Agreement on Trade-Related Aspects of Intellectual Property
Rights (TRIPS)
The Agreement on Trade Related Aspects of Intellectual
Property Rights (TRIPS) is an international agreement
administered by the World Trade Organization (WTO) that sets down
minimum standards for many forms of intellectual property (IP)
regulation as applied to nationals of other WTO Members

14. Trade Negotiation Rounds

15. •The first 5 rounds dealt mainly with tariff
reductions but later negotiations included
other areas such as anti-dumping and non-
tariff measures.
•The last round under GATT–The Uruguay
Round of Negotiations (1986-94) established
the WTO with its ‘single undertaking’ (Every
agreement of WTO falls on every member of
the WTO).

16. Basic Principles
Trade should be --
1. Without discrimination
2. Predictable
3. More competitive
4. More beneficial for least developed
countries

17. Trade wiThouT
discriminaTion
1. Most- favored-nation (MFN) – no discriminate between
trading partners
2. National treatment: Treating foreigners and locals
equally
Imported and locally produced goods should be treated
equally — at least after the foreign goods have entered
the market. The same should apply to foreign and
domestic services, and to foreign and local trademarks,
copyrights and patents.

18. PredicTabiliTy of Trade
• 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
more comPeTiTive
Discouraging “unfair” practices such as export
subsidies and dumping products at below cost to gain
market share

19. more beneficial for
leasT develoPed
counTries
•Giving LDCs more time to adjust,
•greater flexibility, and special privileges.
--- Special and differential treatments

20. Structureof theWTO System

21. Six main areas of WTO Agreements

22. Domestic Support in Agriculture:
TheAmber Box
• WTO members calculated how much direct support they were
providing per year for the agricultural sector (using calculations known
as “total aggregate measurement of support” or “Total AMS”) in the
base years of 1986–88.
• Developed countries agreed to reduce these figures by 20% over six
years starting in 1995.
• Developing countries agreed to make 13% cuts over 10 years.
• Least-developed countries do not need to make any cuts. (If they were
providing subsidy at all when the agreement was signed!)
This category of domestic support is sometimes called the “amber
box”, a reference to the amber colour of traffic lights, which means
“slow down”

23. Domestic Support to Agriculture:
TheGreen Box
• Measures with minimal impact on trade can be used freely
— they are in a “green box”.
• They include government services such as research, disease
control, infrastructure and food security.
• They also include payments made directly to farmers that do
not stimulate production, such as certain forms of direct
income support, assistance to help farmers restructure
agriculture, and direct payments under environmental and
regional assistance programmes.

24. Domestic Support to Agriculture:
TheblueBox
• Certain direct payments to farmers are permitted, where the farmers
are required to limit production (sometimes called “blue box”
measures)
• Domestic support is also permitted for certain government assistance
programmes to encourage agricultural and rural development in
developing countries, and other support on a small scale (“de
minimis”) when compared with the total value of the product or
products supported (5% or less in the case of developed countries and
10% or less for developing countries).
• Least-developed countries do not need to make any cuts. But
important is what they have committed during while signing the
agreement.

25. Indiaand WTO
India one of members of General Agreement on
Tariffs and Trade (GATT) since 1948.
After Marrakesh Agreement, India joined WTO since inception
in 1995.
Aim to participate in WTO rule based system with greater
stability, transparency and predictability in governance of
international
trade.
Developing countries like India availed of greater trade
opportunities and
also challenged certain policies of developed countries (DCs)
Developmental issues increasingly focused along with trade
issues
S&D treatment for developing and LDCs incorporated

26. POSITIVE IMPACT ON INDIAN
ECONOMY
• Increase in export earnings
• Agricultural exports
• Export of textile and clothing
• Multilateral rules and discipline
• Growth to service exports
• Foreign investment

27. ARTICLESIN INDIAN EXPRESS:
IMPACT OF WTO
ON INDIA

28. CONCLUSION
Although the stated aim of the WTO is to promote free
trade and stimulate economic growth, some believe
that globally free trade results in rich (both people and
countries) becoming richer awhile the poor getting
poorer.
• It will be able to help weak and poor
countries if it frames rules accordingly.
•It is the place where the member country comes and talks
together and shares their grievance in order to resolve their
problem related to International trade.