A Project on the World Trade Organization
The goal is to help producers of goods and services, exporters, and importers conduct their business. The WTFO is an organization that intends to supervise and liberalize international trade. The organization officially the General Agreement on Tariffs and Trade (GATE), which commenced in 1948. The organization deals with regulation of trade between participating countries; it provides a framework for negotiating and formalizing trade agreements, and a dispute resolution process aimed at enforcing participants’ adherence to WTFO agreements, which are signed by representatives of member governments and deified by their parliaments.
Who we are? There are a number of ways of looking at the World Trade Organization. It is an organization for trade opening. It is a forum for governments to negotiate trade agreements. It is a place for them to settle trade disputes. It operates a system of trade rules. Essentially, the WTFO is a place where member governments try to sort out the trade problems they face with each other. The WTFO was born out of negotiations, and everything the WTFO does is the result of negotiations. The bulk of the Wet’s current work comes from the 1986-94 negotiations called the Uruguay
Round and earlier negotiations under the General Agreement on
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These documents provide the legal ground rules for international commerce. They are essentially contracts, binding governments to keep their trade policies within agreed limits. Although negotiated and signed by governments, the goal is to help producers of goods and services, exporters, and importers conduct their business, while allowing governments to meet social and environmental objectives. The system’s overriding purpose is to help trade flow as freely as possible ? so long as there are no undesirable side effects ? because this is important for economic development and well-being.
That partly means removing obstacles. It also means ensuring that individuals, companies and governments know what the trade rules are around the world, and giving them the confidence that there will be no sudden changes of policy. In other words, the rules have to be transparent’ and predictable. Trade relations often involve conflicting interests. Agreements, including those painstakingly negotiated in the WTFO system, often need interpreting. The most harmonious way to settle these differences is through some neutral procedure based on an agreed legal foundation.
That is the purpose behind the dispute settlement process written into the WTFO agreements. The WTFO agreements are lengthy and complex because they are legal texts covering a wide range of activities. But a number of simple, fundamental principles run throughout all of these documents. These principles are the foundation of the multilateral trading system. 1 . Non-discrimination-A country should not discriminate between its trading partners and it should not discriminate between its own and foreign products, services or nationals. 2.
More open-Lowering trade barriers is one of the most obvious ways of encouraging trade; these barriers include customs duties (or tariffs) and measure such as import NAS or quotas that restrict quantities selectively. 3. Predictable and transparent-Foreign companies, investors and governments should be confident that trade barriers should not be raised arbitrarily. With stability and predictability, investment is encouraged, Jobs are created and consumers can fully enjoy the benefits of competition ? choice and lower prices. 4.
More competitive-Discouraging ‘unfair’ practices, such as export subsidies and dumping products at below cost to gain market share; the issues are complex, and the rules try to establish what is fair or unfair, and how governments can respond, in reticular by charging additional import duties calculated to compensate for damage caused by unfair trade. 5. More beneficial for less developed countries-Giving them more time to adjust, greater flexibility and special privileges; over three-quarters of WTFO members are developing countries and countries in transition to market economies.
The WTFO agreements give them transition periods to adjust to the more unfamiliar and, perhaps, difficult WTFO provisions. 6. Protect the environment-The Wet’s agreements permit members to take measures to protect not only the environment but also public health, animal health and plant health. However, these measures must be applied in the same way to both national and foreign businesses. In other words, members must not use environmental protection measures as a means of disguising protectionist policies. What is our mission?
The World Trade Organization ? the WTFO ? is the international organization whose primary purpose is to open trade for the benefit of all. The WTFO provides a forum for negotiating agreements aimed at reducing obstacles to international trade and ensuring a level playing field for all, thus contributing to economic growth and development. The WTFO also provides a legal and institutional framework for the implementation and monitoring of these agreements, as well as for settling disputes arising from their interpretation and application.
The current body of trade which all WTFO members are parties) and two different bilateral agreements (to which only some WTFO members are parties). Over the past 60 years, the WTFO, which was established in 1995, and its predecessor organization the GATE have helped to create a strong and prosperous international trading system, thereby contributing to unprecedented global economic growth. The WTFO currently has 159 members, of which 117 are developing countries or separate customs territories. WTFO activities are supported by a Secretariat of some 700 staff, led by the WTFO Director-General.
The Secretariat is located in Geneva, Switzerland, and has an annual budget of approximately CHEF 200 million ($180 million, ?¬130 million). The three official languages of the WTFO are English, French and Spanish. Decisions in the WTFO are generally taken by consensus of the entire membership. The highest institutional body is the Ministerial Conference, which meets roughly every two years. A General Council conducts the organization’s business in the intervals between Ministerial Conferences. Both of these bodies comprise all members.
Specialized subsidiary bodies (Councils, Committees, Sub-committees), also comprising all members, administer and monitor the implementation by members of the various WTFO agreements. More specifically, the Wet’s main activities are: Negotiating the reduction or elimination of obstacles to trade (import tariffs, other barriers to trade) and agreeing on rules governing the conduct of international trade (e. G. Antiquating, subsidies, product standards, etc. ) Administering and monitoring the application of the Wet’s agreed rules for trade in goods, trade in services, and trade-related intellectual property rights
Monitoring and reviewing the trade policies of our members, as well as ensuring transparency of regional and bilateral trade agreements Settling disputes among our members regarding the interpretation and application of the agreements Building capacity of developing country government officials in international trade matters Assisting the process of accession of some 30 countries who are not yet members of the organization Conducting economic research and collecting and disseminating trade data in support of the Wet’s other main activities Explaining to and educating the public about the WTFO, its mission and its activities.
The Wet’s founding and guiding principles remain the pursuit of open borders, the and among members, and a commitment to transparency in the conduct of its activities. The opening of national markets to international trade, with Justifiable exceptions or with adequate flexibilities, will encourage and contribute to sustainable development, raise people’s welfare, reduce poverty, and foster peace and stability. At the same time, such market opening must be accompanied by sound domestic and international policies that contribute to economic growth and development according to each member’s needs and aspirations.
THE CONTENTIOUS ISSUES OF WTFO The Controversy The World Trade Organization has indeed been a controversial organization to say the least. In the past few years there have been street riots, and if not riots, then boisterous public demonstrations against the activities of the World Trade Organization. Why is this contentious issue for so very many people? According to the World Trade Organization’s (WTFO) own web site, The World Trade Organization (WTFO) is the only global international organization dealing with the rules of trade between nations.
At its heart are the WTFO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters, and importers conduct their business. This certainly sounds like a reasonable idea to many people in the world. So what’s the problem? The WTFO was created to become the international successor organization to the General Agreement on Tariffs and Trade (GATE), once commonly known as the G-7 nations, led by the United States.
The G-7 nations were the seven nations with the strongest economies in the world, and their primary focus was the economy of the world’s nations (primarily the 6-7). The WTFO is a much more inclusive organization which recently agreed to admit two of the least developed nations to membership. Cambodia and Nepal are scheduled for admittance at the WTFO Ministerial Conference at Cancan, Mexico in September, 2003. There are now more than 110 member nations in the WTFO. So again what is the problem for many people with the WTFO?
The WTFO is certainly not the only international organization concerned with tariffs and trade. After all, there is the North American Free Trade Association, the European Union, and other such organizations throughout the world. The organization known as Global Exchange lists seasons to oppose the WTFO. In an article written by Vandal Shiva, The Historic Significance of Seattle (1112/00) he explains the opposition to the WTFO. The WTFO met in 2001 in Doth, Qatar: in the article WTFO Attempts to Silence Opposition By Meeting in Qatar: Why do trade rules trump others? Published in the Toronto Star in its November 9, 2001 Friday Ontario Edition, by Joy Duffy, the journalist explains more views about what she perceived as negative effects on many issues caused by the coordinated efforts of the World Trade Organization. Furthermore the environmental group Greenback has been actively involved in Now that you have had a chance to examine the pros and cons presented by the web sites provided that concern the topic of the World Trade Organization, of which the United States is a major supporter both in financial contributions to the organization, as well as actively participating in the leadership of the WTFO.
What do you think? Is the WTFO a positive international organization with the general betterment of the world as its goal, or it the WTFO an organization with a silent agenda to only serve the interests of multinational corporations. Trample over labor and human rights. Destroy the environment. Undermine local development and penalize poor countries. Undermine national sovereignty. What did WTFO do wrong? WTFO has received criticized by various groups and third world countries for numerous things, including: 1.
Being very opaque and not allowing enough public participation, while being very welcoming to large corporations. (That doesn’t help the claims of free, open and democratic! ) 2. That while importing nations cannot distinguish how something is made when trading, though it sounds good at first along the lines of equality and non- discrimination, the reality is that some national laws and decisions for safety and retention of people’s health, environment and national economies have been deemed as barriers to free trade.
Take the following as a very small set of examples: Countries cannot say no to genetically engineered food milk that contains genetically engineered growth hormones known to cause health problems or trees that have been felled from pristine forests and so on. Guatemala took efforts to help reduce infant mortality, in accordance with the World Health Organization’s guidelines, and to counter aggressive marketing by baby food companies aimed at convincing mothers their products are superior to the more atrocious and disease-protecting breast milk for their babies.
The result? The affected corporations managed to take this to GATE (the predecessor to the WTFO) and get a reversal of the law amidst the threat of sanctions. Profits prevailed. Also makes the point of how the victim’s views are not heard in WTFO proceedings, nor ar they part of the debate, even though there may be thousands of them. ) The United States’ attempt to ban shrimp caught using apparatus that were harmful to endangered sea turtles has been ruled as WTFO-illegal, forcing the US to reverse its decision.
A number of countries have also spoken out against the WTFO saying that there needs to be more co-operation between the North and South (a general term to refer to the Rich and Developing countries, respectively) with regards to international trade. 1 . During the week of May 20, 1998, celebrations marked 50 years of multilateral trade. However, as the following link mentions, the African nations did not feel that there was much to rejoice at and said that it was a party where only the rich nations has something to celebrate. 2.
Most people in the world have not benefited from the current form of “multilateral” trading systems. 3. At a Mercury (South America’s Southern Common Market) summit, then South African President, Nelson Mandela, had spoken of the need to ensure that there is more fairness in the globalization process. Mercury is the world’s fourth largest economic power, after the United States, European Union and Japan. WTFO and globalization Environmental groups argue that globalization harms the environment; they want the WTFO to change its rules so that trade sanctions can be used to enforce environmental goals.
They blame global corporations for global warming, depletion of natural resources, production of harmful chemicals and destruction of organic agriculture. They have particular criticism against global investment, which they argue takes advantage of the lack of regulation in poorer developing countries. Hence, global companies may locate polluting industries in poor countries, log tropical forests, or develop mines with inadequate controls. They oppose production, use and global trade in toxic chemicals, nuclear materials and other products of which they do not approve, such as GM foods, or endangered wildlife, including fish.
They oppose the existing rules of the WTFO, which do not allow countries to ban imports of goods Just because their production may have damaged the environment n the country of origin. Environmental groups argue that WTFO rules are unacceptable from the environmental perspective and they want the rules amended a concern that global financial institutions, such as the MIFF and the WEB, are not doing enough to alleviate poverty and, indeed, may be contributing to it. They argue that poor countries should have their debts to international banks excused.
Some are critical of the WTFO saying that its rules favor companies from wealthy countries. They argue that by making it difficult for countries to protect their own industries tit discriminatory tariffs, it is hard for poor countries to build domestic industries. Environmental Issues in the GATE and the WTFO Notwithstanding the extraordinary publicity surrounding the Seattle demonstrations, the proposition that environmental concerns should be addressed internationally along with trade policies was far from new in 1999. Trade and environment” issues first came to prominence almost three decades earlier. In 1971 the GATE established a Group on Environmental Measures and International Trade, intended as “a standby machinery which would be ready to act, at the request of a contracting party, when he need arose. ” The United Nations conference on the Human Environment, held in Stockholm in 1972, highlighted the possibility that strong environmental policies could undermine the international competitiveness of a country’s industries.
While the danger that competitiveness concerns might promote a “race to the bottom” or at least discourage adoption of stronger environmental protection?”regulatory chill”? remains a core issue today, the trade and environment agenda has broadened over the years. In addition to the traditional and still pressing concerns of air and water elution, negotiations may now include such topics as depletion of natural resources, use of hormones to promote cattle growth,18 reduction of biodiversity, and genetic modification of plants and animals. Moreover, these newer aspects Nordstrom and Vaughan, supra note 8.
The first activation came nearly twenty years later, Just prior to the Uruguay Round, at the request of the countries from the European Free Trade Area. The main environmental issue raised in the intervening years related to trade of domestically prohibited goods. Such goods included pharmaceuticals and pesticides whose sale in the exporting country’s domestic arrest was no longer permitted due to health or environmental concerns, as well as radioactive or other hazardous waste materials. European Union restrictions on imports of beef raised using hormones have already given rise to a WTFO trade dispute.
See Report of the Appellate Body, European Communities – Measures concerning Meat and Meat products (Hormones)), WET/ADDS/ABA/R and WET/ADDS/ABA/R (1998) of the trade-environment interface have become increasingly contentious, despite?or perhaps because of?the lack of a firm scientific basis for collective action. Environmental issues had moved into the mainstream of the GATE by April 994, when ministers from more than one hundred countries met in Marshes to conclude the Uruguay Round of multilateral trade negotiations.
Negotiators agreed to establish a Committee on Trade and Environment within the new WTFO. Moreover, the preamble to the agreement establishing the WTFO describes its mandate as “expanding the production and trade in goods and services, while allowing for the optimal use of the world’s resources in accordance with the objective of sustainable development… In a manner consistent with respective needs and concerns at different levels of economic development. ”