Top Six Difference between GATT and WTO
Difference between GATT and WTO
1. The General Agreement on Tariffs and Trade (GATT) was a set of rules a multilateral agreement without institutional foundation with only a small associated secretariat which had its against in the attempt to establish an international trade organization in the 1940, which however, did not see the light of the day, the World Trade Organization (WTO) is a permanent institution with its own full-fledged secretariat located in Geneva, head by a director general, four deputy directors general and over 450 of staff.
2. Even after more than four decades, the GATT was applied, on a ‘provisional basis’, on the contrary, the WTO commitments are full during and permanent
3. The GATT rules applied to trade in merchandise goods. The scope of the WTO is wider because in addition to goods it covers trade in services and related aspect of intellectual property.
4. While the GATT was a multilateral instrument by 1980s. Many new agreements of pluraliateral and therefore relative nature were added rendering its functioning complex and often difficult. The agreements which constitute the WTO are almost multilateral involving commitments for the entire membership.
5. The WTO dispute settlements are faster, more automatic and consequently much less susceptible to blockages than the old GATT system. The implementation of the WTO dispute findings will also more easily assured.
6. Unlike GATT, the WTO is a permanent organization created by international treaty ratified by the governments and legislature of the member states. As the principal international body concerned with solving trade problems between countries and providing a forum for multilateral trade negotiations, it has global status similar to that of the international monetary fund and the World Bank. However, it needs to be stressed that unlike the IMF and the World Bank, it is not a United Nations agency although it has a co-operative relationship with the United Nations.
Broadly speaking GATT is only a legal agreement and it is not an institution. But WTO is a permanent institution. This difference indicates that, GATT is provisional and ad hoc body in its approach whereas WTO has commitments on permanent basis.
Points of Difference between GATT and WTO
| General Agreement on Tariffs and Trade (GATT) | World Trade Organization (WTO) |
| 1. It is a set of rules and multilateral agreement. | 1. It is permanent institution. |
| 2. It was designed with an attempt to establish International Trade Organization. | 2. It is established to serve its own purpose. |
| 3. It was the rules applied to trade in merchandise goods. | 3. In addition to goods, it covers trade in services and trade-related aspects of intellectual property. |
| 4. It was a multilateral instrument. by the 1980, many new agreement have been added of a plurilateral and, therefore of selective nature. | 4. The agreements which constitute the WTO are almost all multilateral and thus involves commitments for the entire membership. |
| 5. Its dispute settlement system was not fast and automatic. | 5. Its dispute settlement system is fast and automatic, |
| 6. It was applied on a provisional basis. | 6. Its activities are well determined and permanent. |
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