Tuesday, 22 February 2011
CASE 222 - World Trade organization
The Bretton Woods Conference of 1944 proposed the creation of an International Trade Organization (ITO) to establish rules and regulations for trade between countries. Members of the UN Conference on Trade and Employment in Havana agreed to the ITO charter in March 1948, but ratification was blocked by the U.S. Senate (WTO, 2004b). Some historians have argued that the failure may have resulted from fears within the American business community that the International Trade Organization could be used to regulate (rather than liberate) big business (Lisa Wilkins, 1997; Helen Milner 1993).
Only one element of the ITO survived: the General Agreement on Tariffs and Trade (GATT). Seven rounds of negotiations occurred under the GATT before the eighth round - known as the Uruguay Round — which began in 1986 and concluded in 1995 with the establishment of the WTO. The GATT principles and agreements were adopted by the WTO, which was charged with administering and extending them and approximately 30 other agreements and resolving trade disputes between member countries. Unlike the GATT, the WTO has a substantial institutional structure.
World Trade Organization (WTO)
The World Trade Organization (WTO) is an international organization which deals with trade between nations. Its origins lie with the establishment of the General Agreement on Tariffs and Trade (GATT) in 1948, which aimed to reduce tariff barriers to trade in goods. As a result of GATT, an informal international organization developed, but it wasn't until the final GATT round in 1994 (Uruguay Round) that a formal international organization (the WTO) was established to oversee the global trading system.
The WTO aims to lower trade barriers among member countries to ensure that trade is free and predictable. Its principles are based on the idea that reducing trade barriers promotes economic growth and prosperity and that trade between countries should be free from discrimination.
At the heart of the WTO are its trade agreements which have been negotiated and ratified by the majority of the world's trading nations (148 member countries as at February 2005). The three key agreements cover trade in goods (the General Agreement on Tariffs and Trade, GATT), trade in services (the General Agreement on Trade in Services, GATS) and trade in ideas (the Agreement on Trade-Related Aspects of Intellectual Property, TRIPS).
As a result of TRIPS, intellectual property has been linked inextricably with trade policy, making it a controversial and political agreement.
The WTO is overseen by a Ministerial Conference and a General Council. The Ministerial Conference meets at least once every two years and provides the mandate for negotiations on the international Agreements and other issues. The outcomes of the Conference are released as declarations, for example the Doha Declaration reporting on the meeting of the Ministerial Conference in 2001. The fifth WTO Ministerial Conference held in Cancun, Mexico in September 2003 broke down over basic disagreement on agriculture subsidies. The sixth WTO Ministerial Conference will be held in Hong Kong between the 13th and 18th of December 2005.
Trade-Related Aspects of Intellectual Property Rights (TRIPS)
Trade-Related Aspects of Intellectual Property Rights (TRIPS) is arguably the most important and comprehensive international agreement on intellectual property rights. Member countries of the WTO are automatically bound by the agreement. The Agreement covers most forms of intellectual property including patents, copyright, trademarks, geographical indications, industrial designs, trade secrets, and exclusionary rights over new plant varieties.