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ECONOMICS ASSIGNMENT

Submitted By: Aamir Nabi Badyari (A3104617033)

Daheem Amin (A3104617074)
Zubair Younis Mir (A3104617017)
Arnav roy (A3104617043)
Armaan gupta (A3104617029)
CONTENTS:

Understanding of WTO
History of WTO
Fact file of WTO
Organization Chart
Functions
Principles
 Advantages and Disadvantages of the World
Trade Organization (WTO)
Current issues of WTO
Trade Statistics around the world
WORLD TRADE ORGANISATION

It is an international organization which regulates the international trade between

nations. The WTO officially commenced on 1 January 1995 under the Marrakesh
Agreement, signed by 123 nations on 15 April 1994, replacing the General
Agreement on Tariffs and Trade (GATT) which commenced in 1948. It is the largest
international economic organization in the world. The WTO deals with regulation of
trade in goods, services and intellectual property between participating countries by
providing a framework for negotiating trade agreements and a dispute resolution
process aimed at enforcing participants' adherence to WTO agreements, which are
signed by representatives of member governmentsand ratified by their parliaments.
The WTO prohibits discrimination between trading partners, but provides exceptions
for environmental protection, national security, and other important goals. Trade-
related disputes are resolved by independent judges at the WTO through a dispute
resolutionprocess.The WTO’s main focus is to provide open lines of communication
concerning trade between its members.

For example, the WTO has lowered trade barriers and increased trade
among member countries. On the other hand, it has also maintained trade barriers
when it makes sense to do so in the global context. Therefore, the WTO attempts to
provide negotiation mediation that benefits the global economy.

Once negotiations are complete and an agreement is in place, the WTO then offers
to interpret that agreement in the event of a future dispute. All WTO agreements
include a settlement process, whereby the organization legally conducts neutral
conflict resolution.
No negotiation, mediation, or resolution would be possible without the foundational
WTO agreements. These agreements set the legal ground rules for international
commerce that the WTO oversees. They bind a country’s government to a set of
constraints that must be observed when setting future trade policies. These
agreements protect producers, importers, and exporters while encouraging world
governments to meet specific social and environmental standards.
History of WTO

Birth of the WTO

The WTO’s creation on 1 January 1995 marked the biggest reform of international trade since the end of
the Second World War. Whereas the GATT mainly dealt with trade in goods, the WTO and its agreements
also cover trade in services and intellectual property. The birth of the WTO also created new procedures
for the settlement of disputes.

Doha Round
The Doha Round was launched in 2001 to achieve major reform of the international trading system
through the introduction of lower trade barriers and revised trade rules. A fundamental objective of the
Doha Development Agenda is to improve the trading prospects of developing countries

Major achievements
Over the past 20 years, WTO members have agreed major updates to the WTO rulebook to improve the flow of
global trade. The WTO's membership has expanded to 164 members, representing over 98% of international
trade. In 2015, the WTO reached a significant milestone with the receipt of its 500th trade dispute for
settlement.

 Revised WTO Agreement on Government Procurement enters into force

 WTO disputes reach 500 mark
 Expansion of the Information Technology Agreement
 TRIPS Agreement amended to ease access to affordable medicine
 Trade Facilitation Agreement enters into force

WTO ministerial conferences

The Ministerial Conference is the highest decision-making body of the WTO and usually meets every two years.
The WTO's first Ministerial Conference was held in Singapore in December 1996. Its most recent — the 11th
— was held in Buenos Aires in December 2017.

GATT and WTO Directors-General

The first Director-General of the GATT was Eric Wyndham White, who held office from  1948 to 1968. The
current Director-General of the WTO is Roberto Azevêdo, who began a second four-year term in September
2017.

Roberto Azevêdo is the sixth Director-General of the WTO. He became  Director-General on 1 September 2013,
serving a four-year term. At a meeting of the General Council in February 2017, WTO members agreed by
consensus to appoint Roberto Azevêdo as Director-General for a second four-year term, which started  on 1
September 2017. DG Azevêdo made a detailed presentation to the February General Council outlining the
successes that the membership achieved since 2013 and his vision for the next four years.
25th anniversary of the WTO
In 2020, the WTO marked its 25th anniversary.

The WTO at 25: A message from the Director-General

Over this past quarter century, the WTO has helped transform international economic relations.
Binding rules for global trade in goods and services have facilitated dramatic growth in cross-border
business activity. Since 1995, the dollar value of world trade has nearly quadrupled, while the real volume
of world trade has expanded by 2.7 times. This far outstrips the two-fold increase in world GDP over that
period.
Average tariffs have almost halved, from 10.5% to 6.4%. For the dozens of economies that joined the
WTO after its creation, accession involved far-reaching reforms and market-opening commitments that
research suggests have been associated with a lasting boost to national income.  
The predictable market conditions fostered by the WTO have combined with improved communications to
enable the rise of global value chains. Confident in their ability to move components and associated
services across multiple locations, businesses have been able to disaggregate manufacturing production
across countries and regions. Trade within these value chains today accounts for almost 70% of total
merchandise trade.
The rise of GVCs has been a key factor in enabling rapid catch-up growth in developing economies, while
facilitating increased purchasing power and consumer choice in all countries. It is not a coincidence that
the past 25 years have seen the fastest poverty reduction in history: in 1995, over one in three people living
around the world fell below the World Bank's $1.90 threshold for extreme poverty. Today the extreme
poverty rate is less than 10%, the lowest ever.
 In recent years, WTO members have agreed to streamline border procedures through a landmark
agreement on trade facilitation projected to lift trade by over $1 trillion per year. They have also liberalised
trade in information technology products and abolished harmful farm export subsidies.
Despite these considerable achievements, it is no exaggeration to say that the WTO faces challenges today
that are unmatched in our relatively short history. Over the past two years, governments have introduced
trade restrictions covering a substantial amount of international trade — affecting $747 billion in global
imports in the past year alone. The rising uncertainty about market conditions is causing businesses to
postpone investment, weighing on growth and the future potential of our economies. How WTO member
governments face up to these challenges will shape the course of the global economy for decades to come.
On balance though there is no doubt that the WTO and the trading system we oversee are regarded by our
164 members as a public good worth preserving and strengthening. This may explain the quiet dynamism
in the WTO's corridors. This energy is palpable, and it suggests profound changes are in the works. 
The WTO’s negotiating functions are now seeing a phase of experimentation that promises to give rise to
new rules of direct relevance to the 21st century economy and contemporary sustainability concerns.
As 2019 drew to a close, we saw a reset in the critically important negotiations aimed at slashing the most
harmful fishing subsidies which are depleting our oceans. Members know that we must have an agreement
by June at our 12th Ministerial Conference in Nur-Sultan, Kazakhstan, or we will have to collectively
shoulder the blame for missing a critical target for the Sustainable Development Goals. Agriculture
negotiations have been reenergised with members taking pragmatic steps to identify where agreement on
vitally important issues may be reached.
Groups of members are also working towards new rules on a range of issues — electronic commerce,
investment facilitation, domestic regulation in services — that aim to make trade more efficient and
predictable in cutting-edge sectors of the economy. Members are seeking, as well, to make it easier, safer
and more viable for women and smaller businesses to participate in global trade. This would help make
trade more inclusive.
It is true that in dispute settlement we suffered a setback at the end of 2019 when members could not agree
on reforms for the Appellate Body. But I have already started consultations with members to explore all
aspects of dispute settlement reform and will engage at high political levels both in Geneva and in capitals
to identify potential solutions. At the same time, many members are weighing an array of creative interim
options to keep two-stage dispute settlement operational while we search for a permanent arrangement.
I continue to believe that the WTO is more important than ever before for the global economy, for job
creation, for growth and for development. And despite the uncertainties around trade today, I think 2020
has real potential to deliver meaningful results. There is a good chance that negotiations percolating in
Geneva will bear fruit in Nur-Sultan, in the shape of new agreements or frameworks. In fact, it's
conceivable that MC12 could produce one of the most impressive clusters of agreements in our history.
If the last 25 years have taught us anything about the WTO, it is that this organization is resilient and
resourceful. We have served our members well over this past quarter of a century and we will continue to
do so in the future.
WTO FACTFILE

  Members
  Members, dually represented by the EU
  Observers
  Non-participant states

Formati 1 January 1995; 25 years ago

on

Type International trade organization

Purpose Reduction of tariffs and other barriers to

trade

Headquarters Centre William

Rappard, Geneva, Switzerland

Region served  Worldwide

Membership  164 member states[1]

Official language  English, French, Spanis

h[2]

Director- Roberto Azevêdo

General

Budget  197.2 million Swiss francs(approx. 209 million

US$) in 2018.[3]
 Staff  640[4]

ORGANIZATION CHART
FUNCTIONS:
Among the various functions of the WTO, these are regarded by analysts as the
most important:

 It oversees the implementation, administration and operation of the covered

agreements (with the exception is that it does not enforce any agreements when
China came into the WTO in Dec 2001) 
 It provides a forum for negotiations and for settling disputes.
Additionally, it is WTO's duty to review and propagate the national trade policies, and
to ensure the coherence and transparency of trade policies through surveillance in
global economic policy-making. Another priority of the WTO is the assistance of
developing, least-developed and low-income countries in transition to adjust to WTO
rules and disciplines through technical cooperation and training.

1. The WTO shall facilitate the implementation, administration and operation and
further the objectives of this Agreement and of the Multilateral Trade
Agreements, and shall also provide the framework for the implementation,
administration and operation of the multilateral Trade Agreements.
2. The WTO shall provide the forum for negotiations among its members
concerning their multilateral trade relations in matters dealt with under the
Agreement in the Annexes to this Agreement.
3. The WTO shall administer the Understanding on Rules and Procedures
Governing the Settlement of Disputes.
4. The WTO shall administer Trade Policy Review Mechanism.
5. With a view to achieving greater coherence in global economic policy making,
the WTO shall cooperate, as appropriate, with the international Monetary
Fund (IMF) and with the International Bank for Reconstruction and
Development (IBRD) and its affiliated agencies
The above five listings are the additional functions of the World Trade Organization.
As globalization proceeds in today's society, the necessity of an International
Organization to manage the trading systems has been of vital importance. As the
trade volume increases, issues such as protectionism, trade barriers, subsidies,
violation of intellectual property arise due to the differences in the trading rules of
every nation. The World Trade Organization serves as the mediator between the
nations when such problems arise. WTO could be referred to as the product of
globalization and also as one of the most important organizations in today's
globalized society.
The WTO is also a centre of economic research and analysis: regular assessments
of the global trade picture in its annual publications and research reports on specific
topics are produced by the organization. Finally, the WTO cooperates closely with
the two other components of the Bretton Woods system, the IMF and the World
Bank.
PRINCIPLES:
The WTO establishes a framework for trade policies; it does not define or specify
outcomes. That is, it is concerned with setting the rules of the trade policy games.
Five principles are of particular importance in understanding both the pre-1994
GATT and the WTO:

1. Non-discrimination. It has two major components: the most favoured

nation (MFN) rule, and the national treatment policy. Both are embedded in
the main WTO rules on goods, services, and intellectual property, but their
precise scope and nature differ across these areas. The MFN rule requires
that a WTO member must apply the same conditions on all trade with other
WTO members, i.e. a WTO member has to grant the most favourable
conditions under which it allows trade in a certain product type to all other
WTO members. "Grant someone a special favour and you have to do the
same for all other WTO members." National treatment means that imported
goods should be treated no less favourably than domestically produced
goods (at least after the foreign goods have entered the market) and was
introduced to tackle non-tariff barriers to trade  (e.g. technical standards,
security standards et al. discriminating against imported goods).
2. Reciprocity. It reflects both a desire to limit the scope of free-riding that may
arise because of the MFN rule, and a desire to obtain better access to foreign
markets. A related point is that for a nation to negotiate, it is necessary that
the gain from doing so be greater than the gain available from
unilateral liberalization; reciprocal concessions intend to ensure that such
gains will materialise.
3. Binding and enforceable commitments. The tariff commitments made by
WTO members in a multilateral trade negotiation and on accession are
enumerated in a schedule (list) of concessions. These schedules establish
"ceiling bindings": a country can change its bindings, but only after
negotiating with its trading partners, which could mean compensating them
for loss of trade. If satisfaction is not obtained, the complaining country may
invoke the WTO dispute settlement procedures.
4. Transparency. The WTO members are required to publish their trade
regulations, to maintain institutions allowing for the review of administrative
decisions affecting trade, to respond to requests for information by other
members, and to notify changes in trade policies to the WTO. These internal
transparency requirements are supplemented and facilitated by periodic
country-specific reports (trade policy reviews) through the Trade Policy
Review Mechanism (TPRM). The WTO system tries also to improve
predictability and stability, discouraging the use of quotas and other
measures used to set limits on quantities of imports.
5. Safety values. In specific circumstances, governments are able to restrict
trade. The WTO's agreements permit members to take measures to protect
not only the environment but also public health, animal health and plant
health.
There are three types of provision in this direction:

1. articles allowing for the use of trade measures to attain non-economic

objectives;
2. articles aimed at ensuring "fair competition"; members must not use
environmental protection measures as a means of disguising protectionist
policies.
3. provisions permitting intervention in trade for economic reasons.
Exceptions to the MFN principle also allow for preferential treatment of developing
countries, regional free trade areas and customs union.

Advantages and Disadvantages of the World Trade

Organization (WTO)

The history of international trade has been a battle between protectionism and free trade,
and the WTO has fueled globalization with both positive and adverse effects. The
organization’s efforts have increased global trade expansion, but a side effect has been a
negative impact on local communities and human rights.

Proponents of the WTO, particularly multinational corporations (MNCs), believe that the
organization is beneficial to business, seeing the stimulation of free trade and a decline in
trade disputes as beneficial to the global economy. Skeptics believe that the WTO
undermines the principles of organic democracy and widens the international wealth gap.
They point to the decline in domestic industries and increasing foreign influence as negative
impacts on the world economy.

As part of his broader attempts to renegotiate U.S. international trade deals, President
Trump has threatened to withdraw from the WTO, calling it a “disaster.” A U.S. withdrawal
from the WTO could disrupt trillions of dollars in global trade.
CURRENT ISSUES:

US removed developing Tag for India

Recently, the United States of America removed the “developing” tag for
dozens of countries. India is one amongst them. These countries are to
be classified as developed countries.

DG Azevêdo announces suspension of WTO meetings

following confirmation of COVID-19 case
Director-General Roberto Azevêdo has informed WTO members that, as of 11
March, all meetings at the WTO will be suspended until 20 March. The decision
follows confirmation that one WTO staff member has contracted the COVID-19 virus.

WTO members consider EU request for panels on Indian

tech tariffs, Colombian duties on fries
At a meeting of the WTO’s Dispute Settlement Body (DSB) on 5 March, WTO
members considered two requests from the European Union for dispute panels to
examine India’s tariffs on certain high-tech goods and Colombia’s anti-dumping
duties on frozen fries from Belgium, Germany and the Netherlands.

Turkey initiates WTO dispute complaint against EU steel

safeguard
Turkey has requested WTO dispute consultations with the European Union
regarding the EU’s safeguard measures on imported steel products. The request
was circulated to WTO members on 19 March.

Advanced Trade Policy Course concludes at the WTO

Thirty participants from around the world attended the Advanced Trade Policy
Course (ATPC) from 27 January to 13 March 2020 at the WTO headquarters in
Geneva. Due to the COVID-19 pandemic, the course had to be shortened by one
week from its original eight-week programme. The course was closed by Mr Jorge
Castro, Chief of the Course Design and Training Section, on behalf of Mrs Bridget
Chilala, Director of the WTO’s Institute for Training and Technical Cooperation
 Trade Statistics around the world
Trade per capita

Trade to GDP ratio

Merchandise exports

Merchandise imports
Commercial services export

Commercial services imports