World Trade Organization (WTO)
1 January 1995
Uruguay Round negotiations (1986-94)
196 million Swiss francs for 2011
To open trade for the benefit of all.
153 countries on 23 July 2008
The World Trade Organization (WTO) deals with the rules of trade between nations at a global or near-global level. But there is more to it than that. 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. Most of the issues that the WTO focuses on derive from previous trade negotiations, especially from the Uruguay Round.
1. THE DERIVATION OF WTO
The WTO is the successor to a previous trade agreement called the General Agreement on Tariffs and Trade (GATT), which was created in 1948. The WTO has a larger membership than GATT, and covers more subjects. Nevertheless, it was GATT that established, multilaterally, the principles underlying this trading system.
A brief history of the WTO
Negotiations among 50 countries, sponsored by the United Nations, to establish an International Trade Organization (ITO) alongside the World Bank and International Monetary Fund. A draft ITO Charter is drawn up. In parallel, 23 countries decide to negotiate a set of tariff reductions among themselves and to adopt some of the draft ITO trade rules. The tariff concessions and rules together are called the General Agreement on Tariffs and Trade (GATT).
January 1: GATT enters into effect on a provisional basis. Of the 23 original members, 11 are developing countries. March: the UN Conference on Trade and Employment, in Havana Cuba, adopts the ITO Charter, but it remains subject to ratification by national legislatures.
United States government announces that it will not seek ratification of the ITO Charter because of opposition in Congress. The ITO is therefore dead.
GATT remains in place as a “provisional” agreement.
Seven completed trade rounds under GATT.
|Year |Place/Name |Subject Covered |No. Countries | |1947 |Geneva |Tariffs |23 | |1949 |Annecy (France) |Tariffs |13 | |1951 |Torquay (UK) |Tariffs |38 | |1956 |Geneva |Tariffs |26 | |1960-61 |Geneva (“Dillon Round”) |Tariffs |26 | |1964-67 |Geneva (“Kennedy Round”) |Tariffs and anti-dumping rules |62 | |1973-79 |Geneva (“Tokyo Round”) |Tariffs, rules on non-tariff barriers, etc |102 |
“Part IV” of the GATT is added to provide more favorable treatment for developing Countries, in particular, that could receive tariff benefits in trade negotiations without necessarily making a reciprocal offer.
The “enabling clause” is added to the GATT to make legal preference schemes for developing countries. These...
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