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World Trade Organization (WTO): What is it and how does it work?

Arfa Javaid

Established on 1 January 1995 in Geneva, Switzerland, World Trade Organization (WTO) is the only international organization that deals with the rules of trade between different nations. It helps its member states to raise living standards, create jobs and improve people’s lives via trade. 

Born out of five decades of negotiations to lessen obstacles to trade, the organization's overriding purpose is to help trade flow as freely as possible. Conversely, in certain cases, the WTO maintains trade barriers to protect consumers or the environment. 

The organization also harmoniously settle disputes through a neutral procedure based on an agreed legal foundation.

How does the organization work?

World Trade Organization (WTO) is run by its member governments and all the major decisions are made by the membership as a whole-- either by ministers (who meet at least once every two years) or by their ambassadors or delegates (who meet regularly in Geneva).

The Secretariat employing more than 600 staff members, and experts assist WTO members daily to ensure that negotiations progress smoothly and that the rules of international trade are correctly applied and enforced.

Trade negotiations

The WTO agreements cover goods, services, intellectual property, and the principles of liberalizations and permitted exceptions. The agreements further include member countries' commitments to lower customs tariffs and other trade barriers for the benefit of all. 

It is worth mentioning that these agreements are not static and are renegotiated from time to time. 

Implementation and monitoring

As per the WTO agreements, the member states are required to notify their trade policies to the WTO. Various WTO councils and committees ensure that these requirements are being followed and WTO agreements are being properly implemented. Additionally, each member nation undergoes periodic scrutiny of its trade policies and practices. 

Dispute settlement

The organization resolves trade disputes between nations under the Dispute Settlement Understanding. If a country is of the view that its rights under the agreements are being infringed, it can bring the dispute to WTO. Specially appointed independent experts pronounce judgements based on the interpretations of the agreements and individual countries’ commitments.

Building trade capacity

The agreements contain special provisions for developing countries such as longer time periods implement agreements and commitments, measures to increase their trading opportunities, and support to help them build their trade capacity, handle disputes and implement technical standards. 

The organization further maintains a regular dialogue with NGOs, Parliamentarians, media, and the general public to enhance cooperation and increase awareness of WTO activities. 

Fundamental Principles

Fundamental principles as mentioned in the WTO agreements are mentioned below:

1- Non-discrimination between trading partners and between their own and foreign products, services or nationals. 

2- Encouraging trade by lowering trade barriers which may include customs duties (or tariffs), import bans or quotas. 

3- Predictability and transparency to encourage investment, job opportunities, and benefits of competition for consumers. 

4- Fair competition by discouraging unfair trade means such as export subsidies and dumping products at below normal value to gain market share. 

5- Supporting less-developed nations as over three-quarters of WTO members are developing economies or in transition to market economies. 

6- Sustainable approach towards both national and foreign businesses. However, the environmental factors must not be used as an excuse for discriminatory trade barriers. 

7- Inclusive trading system to allow more women and small businesses to participate in trade and to reap the economic benefits of global trading.

8- Enhancing cooperation and building partnerships through regular dialogue with civil society, labour unions, universities, and the business community. 

Members and Observers

WTO has had 164 members since 29 July 2016. The below-mentioned table below comprises Member Nations of the World Trade Organization along with their date of joining.

S.No. Member Nation Date of Joining
1. Afghanistan 29 July 2016
2. Albania 8 September 2000
3. Angola 23 November 1996
4. Antigua and Barbuda 1 January 1995
5. Argentina 1 January 1995
6. Armenia 5 February 2003
7. Australia 1 January 1995
8. Austria 1 January 1995
9. Bahrain 1 January 1995
10. Bangladesh 1 January 1995
11. Barbados 1 January 1995
12. Belgium 1 January 1995
13. Belize 1 January 1995
14. Benin 22 February 1996
15. Bolivia 12 September 1995
16. Botswana 31 May 1995
17. Brazil 1 January 1995
18. Brunei Darussalaam 1 January 1995
19. Bulgaria 1 December 1996
20. Burkina Faso 3 June 1995
21. Burundi  23 July 1995
22. Cabo Verde 23 July 2008
23. Cambodia 13 October 2004
24. Cameroon 13 December 1995
25. Canada 1 January 1995
26. The central African Republic 31 May 1995
27. Chad 19 October 1996
28. Chile 1 January 1995
29. China 11 December 2001
30. Colombia 30 April 1995
31. Congo 27 March 1997
32. Costa Rica 1 January 1995
33. Costa Rica 1 January 1995
34. Côte d’Ivoire 30 November 2000
35. Croatia 20 April 1995
36. Cyprus 30 July 1995
37. Czech Republic 1 January 1995
38. The Democratic Republic of the Congo 1 January 1997
39. Denmark 1 January 1995
40. Djibouti 31 May 1995
41. Dominica 1 January 1995
42. Dominican Republic 9 March 1995
43. Ecuador 21 January 1996
44. Egypt 30 June 1995
45. El Salvador 7 May 1995
46. Estonia 13 November 1999
47. Eswatini 1 January 1995
48. European Union 1 January 1995
49. Fiji 14 January 1996
50. Finland 1 January 1995
51. France 1 January 1995
52. Gabon 1 January 1995
53. The Gambia 23 October 1996
54. Georgia 14 June 2000
55. Germany 1 January 1995
56. Ghana 1 January 1995
57. Greece 1 January 1995
58. Grenada 22 February 1996
59. Guatemala 21 July 1995
60. Guinea 25 October 1995
61. Guinea-Bissau 31 May 1995
62. Guyana 1 January 1995
63. Haiti 30 January 1996
64. Honduras 1 January 1995
65. Hong Kong 1 January 1995
66. Hungary 1 January 1995
67. Iceland 1 January 1995
68. India 1 January 1995
69. Indonesia 1 January 1995
70. Ireland 1 January 1995
71. Israel 21 April 1995
72. Italy 1 January 1995
73. Jamaica 9 March 1995
74. Japan 1 January 1995
75. Jordan 11 April 2000
76. Kazakhstan 30 November 2015
77. Kenya 1 January 1995
78. Korea 1 January 1995
79. Kuwait 1 January 1995
80. Kyrgyz Republic 20 December 1998
81. Lao People's Democratic Republic 2 February 2013
82. Latvia 10 February 1999
83. Lesotho 31 May 1995
84. Liberia 14 July 2016
85. Liechtenstein 1 September 1995
86. Lithuania 31 May 2001
87. Luxembourg 1 January 1995
88. Macao 1 January 1995
89. Madagascar 17 November 1995
90. Malawi 31 May 1995
91. Malaysia 1 January 1995
92. Maldives 31 May 1995
93. Mali 31 May 1995
94. Malta 1 January 1995
95. Mauritania 31 May 1995
96. Mauritius 1 January 1995
97. Mexico 1 January 1995
98. Moldova 26 July 2001
99. Mongolia 29 January 1997
100. Montenegro 29 April 2012
101. Morocco 1 January 1995
102. Mozambique 26 August 1995
103. Myanmar 1 January 1995
104. Namibia 1 January 1995
105. Nepal 23 April 2004
106. Netherlands 1 January 1995
107. New Zealand 1 January 1995
108. Nicaragua 3 September 1995
109. Niger 13 December 1996
110. Nigeria 1 January 1995
111. North Macedonia 4 April 2003
112. Norway 1 January 1995
113. Oman 9 November 2000
114. Pakistan 1 January 1995
115. Panama 6 September 1997
116. Papua New Guinea 9 June 1996
117. Paraguay 1 January 1995
118. Peru 1 January 1995
119. Philippines 1 January 1995
120. Poland 1 July 1995
121. Portugal 1 January 1995
122. Qatar 13 January 1996
123. Romania 1 January 1995
124. Russian Federation 22 August 2012
125. Rwanda 22 May 1996
126. Saint Kitts and Nevis 21 February 1996
127. Saint Lucia 1 January 1995
128. Saint Vincent and the Grenadines 1 January 1995
129. Samoa 10 May 2012
130. Suadi Arabia 11 December 2005
131. Senegal 1 January 1995
132. Seychelles 26 April 2015
133. Sierra Leone 23 July 1995
134. Singapore 1 January 1995
135. Slovak Republic 1 January 1995
136. Slovenia 30 July 1995
137. Solomon Islands 26 July 1996
138. South Africa 1 January 1995
139. Spain 1 January 1995
140. Sri Lanka 1 January 1995
141. Suriname 1 January 1995
142. Sweden 1 January 1995
143. Switzerland 1 January 1995
144. Chinese Taipei 1 January 2002
145. Tajikistan 2 March 2013
146. Tanzania 1 January 1995
147. Thailand 1 January 1995
148. Togo 31 May 1995
149. Tonga 27 July 2007
150. Trinidad and Tobago 1 March 1995
151. Tunisia  29 March 1995
152. Turkey 26 March 1995
153. Uganda 1 January 1995
154. Ukraine 16 May 2008
155. United Arab Emirates 10 April 1996
156. United Kingdom 1 January 1995
157. United States 1 January 1995
158. Uruguay 1 January 1995
159. Vanuatu 24 August 2012
160. Venezuela 1 January 1995
161. Vietnam 11 January 2007
162. Yemen 26 June 2014
163. Zambia 1 January 1995
164. Zimbabwe 5 March 1995

Observer Nations

WTO has 25 Observer Nations. These are as follows:

1. Algeria

2. Andorra

3. Azerbaijan

4. The Bahamas

5. Belarus

6. Bhutan

7. Bonia and Herzegovinana

8. Comoros

9. Curaçao

10. Equitorial Guinea

11. Ethiopia

12. Holy See

13. Iran

14. Iraq

15. Lebanese Republic

16. Libya

17. Sao Tomé and Principe

18. Serbia

19. Somalia

20. South Sudan

21. Sudan

22. The Syrian Arab Republic

23. Timor-Leste

24. Turkmenistan

25. Uzbekistan

Director-General and Deputy Directors-General of WTO

Ngozi Okonjo-Iweala is the seventh Director-General of the WTO. She is also the first woman and the first African to serve on the post. She took office on 1 March 2021 and her term of office will expire on 31 August 2025.

On 4 May 2021, she appointed Angela Ellard of the United States, Anabel González of Costa Rica, Ambassador Jean-Marie Paugam of France and Ambassador Xiangchen Zhang of China as her four Deputy Directors-General.

All about WTO's Seventh Trade Policy Review (TPR) of India

रोमांचक गेम्स खेलें और जीतें एक लाख रुपए तक कैश

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