World Trade Organization (WTO) : Features, Structure and Administration

World Trade Organization (WTO)

The Uruguay round of GATT (1986-93) gave birth to WTO. The members of the GATT signed on an agreement of Uruguay round in April 1994 in Morocco for establishing a new organization named World Trade Organization (WTO). It was officially constituted on January 1, 1995 which took the place of GATT as an effective formal organization.

In short, WTO is a new globally recognized trade organization with the new name succeeding GATT on reviewed agreements and having a new vision and strong enforcement power to promote international trade.

WTO: An Introduction

1. Born – The WTO was born out of the General Agreement of Tariffs and Trade (GATT)
2. Headquarters – Geneva, Switzerland
3. Formation – 1 January, 1995
4. Membership – 153 Member Countries
5. Budget – 163 Million USD (Approx.)

Features of WTO

Following are the salient features of the WTO:

1. It has replaced GATT.
2. It is an International Trade Organization.
3. It is based on multilateral trading system. The ultimate aim is to establish a rule based global system of free trade.
4. Its statue is equal to IMF and IBRD.
5. It includes trade in goods, trade in services, protection of intellectual property-rights, trade-related investment measures etc.
6. Agreements agreed by member-countries are binding on all members of WTO and if any member does not follow such agreements, then its complaint can be lodged with the Dispute Settlement Body of WTO.
7. It has wider scope than GATT. It covers GATT agreements and agreements on trade service, intellectual property rights and investment.
8. Unlike International Monetary Fund (IMF) and the World Bank, it is not an agent of United Nations.
9. Unlike IMF and World Bank, there is no weighted voting, rather all the WTO members have equal voting rights (One Country, One Vote).
10. The decision-making under this organization is carried out by consensus. Each member has one vote.
11. WTO has a large secretariat and huge organizational set-up.

Structure of the WTO

1. Ministerial Conference: It is the highest hierarchical level in the organizational structure, It is composed of representatives of all the member countries which meet at least once every two years. It is the policy and strategy -making body. The Ministerial conference takes decisions on all matters under any of the Multilateral Trade Agreements.

2. General Council: It is the executive body of the WTO. The Ministerial Conference gets the polices and strategies implemented and executed through General Council. All the member countries of the WTO have their representative in the General Council. It also acts as the Dispute Settlement Body as well as the Trade Policy Review Body.

3. Functional Council under the General Council: There are three functional councils under the General Council which are as follow:

(i) Council for Trade in good – This council undertakes the functions of the Multilateral Trade Agreement (MTA) relating to trade in goods.

(ii) Council for Trade in Services – This council undertakes the functions of (MTA) relating to trade in services.

(iii) Council for Trade-related Aspects of Intellectual Property Rights (TRIPRS): This council undertakes the implementations and functions of all the agreements relating to this area.

4. Committees and Management Bodies: There are three committees, viz., the Committee on Trade and Development (CTD). The Committee on Balance of Payment Restrictions (CBOPR), and the Committee on Budget, Finance and Administration (CBFA) which execute the functions assigned to them by the WTO Agreement and the GC.

Administration of WTO

The Administration of the WTO is conducted by the secretariat which is headed by the Director General (DG) appointed by the MC for the tenure of four years. He is assisted by the four Deputy Directors from different member countries.

There are number of important committees for administration of WTO, out of which, 2 committees play the pivotal role in WTO. They are:

1. Dispute Settlement Body – DSB
2. Trade Policy Review Body – TPRB

DSB considers the complaints of member countries against violation of rules by any member country. This body appoints a group of experts to investigate into such complaints. The body meets twice a month for such cases.

TPRB reviews the trade policy of the member countries. The trade policies of all the big trade powers of World are reviewed after every 2 years. All the members of WTO are the member of TPRB.

The present strength of WTO membership is 164.

IMPORTANT LINK

• What is Meaning of Analysis of Financial Statement? Its objectives and importance
• IMPORTANCE AND LIMITATIONS OF FINANCIAL STATEMENTS
• Meaning and Definitions of Financial Statement | Nature of Financial Statements | Characteristics of an Ideal Financial Statement
• What is the scope of management accounting?
• Procedure of Financial Statements Analysis
• Comparative Financial statement Analysis | Advantages of Comparative Financial Statements | Limitations of Comparative Financial Statements
• IMPORTANCE AND LIMITATIONS OF TREND ANALYSIS IN HINDI

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