4.6-World Trade Organisation

4.6-World Trade Organisation Important Formulae

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4.6 - World Trade Organisation (WTO)
  • The WTO is an international body that regulates global trade rules between countries.
  • It was established in 1995 to replace GATT (General Agreement on Tariffs and Trade).
  • Its main objectives include promoting trade liberalization, ensuring trade fairness, and resolving disputes between member countries.
  • The WTO provides a platform for negotiations and monitoring trade agreements.
  • WTO members must follow agreed-upon trade rules and policies.
  • It helps in reducing trade barriers like tariffs and quotas.
  • The WTO promotes a more stable and predictable trading environment.

The World Trade Organisation (WTO) is a global institution that plays a crucial role in regulating international trade. Understanding its functions, objectives, and impact is essential for comprehending globalisation and trade dynamics.

1. Definition and Formation: The WTO was established on January 1, 1995, as a successor to the General Agreement on Tariffs and Trade (GATT), which was created in 1948. Its primary aim is to promote and facilitate international trade by providing a framework for negotiating trade agreements and resolving trade disputes.

2. Objectives of the WTO: The main objectives of the WTO include:

  • Promoting Free Trade: The WTO aims to reduce trade barriers such as tariffs, quotas, and subsidies, thereby promoting free trade among member countries.
  • Ensuring Fair Competition: The organization works to establish a level playing field for all countries, ensuring that trade is conducted fairly and transparently.
  • Encouraging Economic Growth: By facilitating trade, the WTO aims to boost economic growth and development, particularly in developing countries.
  • Providing a Forum for Negotiation: The WTO serves as a platform for member countries to negotiate trade agreements and address trade-related issues.

3. Structure of the WTO: The WTO operates through a structured framework that includes various bodies and councils:

  • Ministerial Conference: This is the highest decision-making body, which meets every two years to set the agenda and make major decisions.
  • General Council: Comprising representatives from all member countries, the General Council oversees the day-to-day operations and implements decisions made at the Ministerial Conference.
  • Dispute Settlement Body: This body resolves trade disputes between member countries, ensuring that trade rules are adhered to and conflicts are managed effectively.

4. Functions of the WTO: The WTO performs several key functions:

  • Administering Trade Agreements: The WTO oversees the implementation of various trade agreements, ensuring compliance and facilitating cooperation among member nations.
  • Monitoring Trade Policies: The organization conducts regular reviews of member countries' trade policies to ensure transparency and adherence to WTO rules.
  • Providing Technical Assistance: The WTO offers technical assistance and training to developing countries, helping them build capacity and enhance their participation in global trade.
  • Conducting Research and Analysis: The WTO conducts research on global trade trends, providing valuable data and analysis to member countries.

5. Membership and Participation: The WTO has 164 member countries, representing over 98% of global trade. Membership is open to any country willing to adhere to the WTO agreements. New members must undergo a rigorous accession process to join.

6. Impact of the WTO: The WTO has had a significant impact on global trade:

  • Trade Liberalisation: The WTO has facilitated the reduction of trade barriers, leading to increased trade flows and economic growth among member countries.
  • Dispute Resolution: The dispute settlement mechanism has provided a structured approach to resolving trade conflicts, fostering stability and predictability in international trade.
  • Support for Developing Countries: The WTO's initiatives and programs aimed at enhancing the participation of developing countries in global trade have contributed to their economic development.

7. Criticisms of the WTO: Despite its achievements, the WTO faces criticisms:

  • Focus on Trade over Social Issues: Critics argue that the WTO prioritizes trade liberalisation over social and environmental concerns, leading to negative impacts on local communities.
  • Power Imbalance: Some member countries believe that the WTO favors developed nations, leaving developing countries at a disadvantage in negotiations.
  • Complexity of Rules: The intricacy of WTO rules and agreements can be challenging for smaller countries, making it difficult for them to navigate the system effectively.

In summary, the World Trade Organisation plays a vital role in shaping international trade policies and promoting global economic integration. Its functions and impact are significant in understanding the complexities of globalisation.


American English logo of the World Trade Organization (WTO).
World Trade Organization, Public domain, via Wikimedia Commons

4.6-World Trade Organisation

विश्व व्यापार संगठन (WTO) एक अंतरराष्ट्रीय संगठन है जो वैश्विक व्यापार नियमों को निर्धारित करता है और सदस्य देशों के बीच व्यापारिक विवादों को हल करने में मदद करता है। यह 1 जनवरी 1995 को स्थापित हुआ और इसका मुख्यालय स्विट्जरलैंड के जिनेवा शहर में स्थित है। WTO का उद्देश्य मुक्त और निष्पक्ष व्यापार को बढ़ावा देना है।

WTO के प्रमुख उद्देश्य निम्नलिखित हैं:

  • विश्व व्यापार में सुधार और वृद्धि करना।
  • सदस्य देशों के बीच व्यापार संबंधों को नियमों के माध्यम से नियंत्रित करना।
  • व्यापार विवादों का समाधान करना।
  • मूल्य और उत्पादन पर विभिन्न शुल्कों के प्रभाव को कम करना।
  • विकासशील देशों को व्यापार में सुधार करने के लिए प्रोत्साहित करना।

WTO में कुल 164 सदस्य देश हैं और यह सभी सदस्य देशों के लिए समान व्यापारिक अवसरों का निर्माण करने का कार्य करता है।

WTO का संरचना:

  • मंत्रिस्तरीय सम्मेलन: यह सर्वोच्च निर्णय लेने वाली संस्था है, जिसमें सभी सदस्य देश शामिल होते हैं। यह सम्मेलन प्रत्येक दो साल में आयोजित होता है।
  • सामान्य परिषद: यह संगठन की मुख्य कार्यकारी संस्था है, जो मंत्रिस्तरीय सम्मेलन के बीच फैसले लेती है।
  • विवाद समाधान अंग (Dispute Settlement Body): यह वह संस्थान है जो देशों के बीच व्यापारिक विवादों का समाधान करता है।
  • वाणिज्यिक समिति: यह समिति व्यापार और नियमों से संबंधित तकनीकी मुद्दों पर चर्चा करती है।

WTO के कार्य:

  1. नियमों का निर्माण और संरक्षण: WTO सदस्य देशों के बीच व्यापार को लेकर नियमों और विधियों का निर्माण करता है, जो समानता और पारदर्शिता सुनिश्चित करता है।
  2. व्यापार विवाद समाधान: जब दो या दो से अधिक देशों के बीच व्यापारिक विवाद उत्पन्न होते हैं, तो WTO मध्यस्थता करता है और निर्णय देता है।
  3. विकासशील देशों का समर्थन: WTO विकासशील देशों को विशेष छूट और सहायक नीतियों का समर्थन देता है, ताकि वे अंतर्राष्ट्रीय बाजार में प्रतिस्पर्धी बन सकें।
  4. व्यापार वार्ताएँ: WTO नए व्यापार समझौतों के लिए वार्ता आयोजित करता है ताकि सदस्य देशों के बीच व्यापार को और अधिक मुक्त और सुविधाजनक बनाया जा सके।

WTO से जुड़े महत्वपूर्ण सिद्धांत:

  • न्यायसंगत और निष्पक्ष व्यापार: WTO यह सुनिश्चित करता है कि सभी सदस्य देशों के बीच व्यापार निष्पक्ष और पारदर्शी तरीके से हो।
  • व्यापार में रुकावटें कम करना: WTO का उद्देश्य व्यापारिक शुल्कों और अन्य अवरोधों को कम करना है, ताकि देशों के बीच व्यापार में आसानी हो।
  • पारस्परिक सहयोग और विकास: WTO ने यह सिद्धांत अपनाया है कि सभी देशों के बीच समान विकास और सहयोग को बढ़ावा दिया जाए।

WTO और भारतीय अर्थव्यवस्था:

भारत WTO का सदस्य 1 जनवरी 1995 से है। इसके बाद भारत ने अपनी व्यापार नीतियों में कई सुधार किए हैं। WTO की सदस्यता से भारत को कई अवसर मिले हैं, जैसे कि व्यापार बाधाओं को कम करना और वैश्विक बाजारों में अपने उत्पादों के लिए नए बाजारों की खोज। इसके साथ ही, भारतीय सरकार ने कृषि, उद्योग, और सेवा क्षेत्रों में विभिन्न सुधार किए हैं ताकि भारतीय उत्पाद अंतर्राष्ट्रीय बाजारों में प्रतिस्पर्धी बन सकें।

WTO द्वारा भारत को व्यापार में मदद के बावजूद, कभी-कभी यह भी देखा जाता है कि WTO के नियम विकासशील देशों के लिए चुनौतीपूर्ण हो सकते हैं, क्योंकि कई बार यह नियम उनकी आंतरिक जरूरतों के खिलाफ होते हैं।

Fill in the blanks. 

WTO was started at the initiative of __________ countries. The aim of the WTO is to ____________________. WTO establishes rules regarding ________________ for all countries, and sees that___________________ In practice, trade between countries is not ______________________________. Developing countries like India have ___________________, whereas developed countries, in many cases, have continued to provide protection to their producers.

Solution:

Fill in the Blanks
WTO was started at the initiative of **23** countries. The aim of the WTO is to **promote free trade and reduce trade barriers**. WTO establishes rules regarding **international trade** for all countries, and sees that **these rules are followed**. In practice, trade between countries is not **always equitable or fair**. Developing countries like India have **faced challenges in accessing markets**, whereas developed countries, in many cases, have continued to provide protection to their producers.

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What do you think can be done so that trade between countries is more fair?

Solution:

Ensuring Fair Trade Between Countries

To promote fair trade, countries can establish equitable trade agreements that prioritize the needs of developing nations. Implementing tariffs on unfair practices and supporting local industries can enhance competitiveness. Additionally, promoting transparency in trade policies helps build trust. Encouraging ethical sourcing and production standards ensures that workers receive fair wages. Strengthening international organizations, like the World Trade Organization, can facilitate dialogue and conflict resolution. Consumer awareness campaigns can also encourage responsible purchasing choices, fostering a more sustainable and just global trade system.

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In the above example, we saw that the US government gives massive sums of money to farmers for production. At times, governments also give support to promote production of certain types of goods, such as those which are environmentally friendly. Discuss whether these are fair or not.

Solution:

Fairness of Government Support to Farmers

Government financial support to farmers aims to stabilize income, ensure food security, and promote specific goods. However, the fairness of such subsidies is debated. On one hand, they help farmers cope with market fluctuations and incentivize environmentally friendly practices. On the other hand, critics argue that these subsidies can distort market prices, favor large agribusinesses over small farmers, and lead to overproduction. Additionally, reliance on subsidies may reduce the incentive for innovation and efficiency among producers. The impact on consumer prices and overall market fairness also raises questions about the equity of such policies.

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