WTO – World Trade Organisation UPSC Notes

World Trade Organisation Notes: The World Trade Organisation (WTO) is a global international organisation that was established to regulate international trade. It basically focuses on promoting free and fair trade. It plays an important role in shaping the rules and principles governing the global trading system. Want to know more about it? Scroll to the given blog to learn its goals, history, structure of governance, and more.

What are the Goals of WTO?

The key goals of the World Trade Organisation are as follows.

• The WTO’s primary goal is to facilitate the free flow of international trade by providing a framework of rules and regulations that govern trade relations among its member countries.
• World Trade Organization’s motive is to protect and promote the principles of free and open trade.
• It makes rules to protect unfair practises, such as selling goods below cost and subsidies that distort international trade.
• WTO’s goal is to contribute to global economic growth and development, specifically in developing countries.
• Another goal of it is to resolve trade disputes among its members through its well-defined dispute settlement mechanism.
• By having a rules-based trading system, the WTO aims to create a stable and predictable environment for international trade.

History of WTO

• World Trade Organisation began on January 1, 1995, but its trading system was made half a century ago. 
• After that, since 1948, the General Agreement on Tariffs and Trade (GATT) has been providing the rules for the system. 
• Then the second WTO ministerial meeting took place in May 1998, which also included the celebration of the 50th anniversary.
• Slowly, it gave birth to an unofficial, de facto international organization, known as GATT.
• The last and biggest GATT round was the Uruguay Round, which lasted from 1986 to 1994. Also, this round gave rise to the WTO’s creation.

Also Read: World Economic Forum Notes for Exams

Why did WTO Replace the GATT?

There are several reasons why the World Trade Organisation replaced GATT, below are some of them.

• GATT is primarily focused on reducing tariffs and trade barriers on goods, whereas the WTO has trade in goods, services, and intellectual property rights.

• The GATT’s dispute settlement mechanism was limited in its effectiveness. On the other hand, WTO introduced a more secure and binding dispute resolution system, which made it easier for the countries to resolve trade disputes through established procedures.

• GATT lacked a strong legal foundation, which led to confusion in trade rules. The WTO created a more comprehensive framework, to provide greater clarity for international trade.

• The GATT operated as an informal agreement, whereas WTO is a full-fledged international organisation with a permanent secretariat.

• GATT did not have a systematic process for updating the trade rules, making it cover the WTO, which has mechanisms for regular trade policy reviews and negotiations.

WTO Ministerial Conferences Till Today

There have been a total of 12 ministerial conferences so far. The first Ministerial Conference (i.e., MC1) took place in Singapore in 1996. The last one (MC11) took place in Buenos Aires in 2017. All these MCs have contributed to the prevailing global trading system.

FAQ

We hope that you have gathered the relevant information related to the World Trade Organisation. For much more content on facts like this, you can turn to our general knowledge page. Also, you can check out our blog on general knowledge for competitive exams here! Keep learning.