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What is the World Trade Organization?

The World Trade Organization is an organization for trade opening. It is a forum for governments to negotiate trade agreements and also a place for them to settle trade disputes. It operates a system of trade rules. The WTO is a place where member governments try to sort out the trade problems they face with each other.

Its beginnings

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The WTO system was developed through a series of trade negotiations. The last negotiations, the 1986-94 Uruguay Round, led to the WTO’s creation. Upon signing the new WTO agreements (which include the updated GATT 1994), on 1 January 1995, the WTO replaced GATT, which had been in existence since 1947.

In 2000, new talks started on agriculture and services. These have been incorporated into a broader agenda launched at the fourth WTO Ministerial Conference in Doha, Qatar, in November 2001.

 

The WTO is often described as a system based on rules. But it’s important to remember that the rules are actually agreements that governments negotiated. This agreements are:

  • Cover goods, services and intellectual property.

  • Explain the principles of liberalization and the permitted exceptions.

  • Include individual countries’ commitments to tariffs and other trade barriers and to open and keep open services markets.

  • Set procedures for settling disputes.

  • Prescribe special treatment for developing countries.

  • Require governments to make their trade policies transparent by notifying the WTO about laws and measures adopted, and through regular reports by the secretariat on countries’ trade policies.

Objectives

The goal of the WTO is to help producers of goods and services, exporters, and importers conduct their business, while allowing governments to meet social and environmental objectives, contributing to global economic growth.  This is regulated by 16 different multilateral agreements (to which all WTO members are parties) and two different plurilateral agreements (to which only some WTO members are parties) which are negotiated and signed by the majority of the world’s trading nations. These documents provide the legal rules for international commerce.

Budget

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The WTO budget is over 160 million Swiss francs with individual contributions calculated on the basis of shares in the total trade conducted by WTO members. Part of the WTO budget also goes to the International Trade Centre.

 

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