ASSIGNMENT OF SSH

TOPIC:
World Trade Organization
Course Title:

Current Affairs (SSH-405)

Submitted to:

Mr. M.AUON

Submitted by:

Group 7
Members name:

Rafay Umar (2022-ag-6619)

Asim Javed (2022-ag-6585)
Haider Ali Rana (2022-ag-6564)
Mustjab Ahmad (2022-ag-6628)
Muhammad (2022-ag-6595)
Muhammad Zubair (2022-ag-6569)
Tayyab Zahid (2022-ag-6622)
 World Trade Organization (WTO)
Introduction:
The World Trade Organization (WTO) is the only international organization dealing with the
global rules of trade. Its main function is to ensure that trade flows as smoothly, predictably
and freely as possible. The World Trade Organization is an international organization that
regulates and facilitates global trade among its member countries. Established on January 1,
1995, the WTO replaced the General Agreement on Tariffs and Trade (GATT) that had been
in place since 1948. The primary objective of the WTO is to create a stable and predictable
international trading environment while reducing trade barriers and ensuring fair trade practices
among nations.

Brief History and Establishment of the WTO:

The World Trade Organization (WTO) was established on January 1, 1995, succeeding the
General Agreement on Tariffs and Trade (GATT) that had been in existence since 1948. The
transition to the WTO marked a significant evolution in international trade governance, aiming
to create a more comprehensive and structured framework for global trade regulation.

 The World Trade Organization (WTO) is an international organization that regulates

and facilitates international trade between Nations.
 There are 164 member countries in the WTO. These countries participate in
negotiations, attend meetings, and abide by the rules and agreements established by the
organization to regulate international trade.

1.Purpose and Objectives of the Organization:

Facilitating Global Trade:

The WTO's main job is to make it easier for countries to trade with each other. It does this by
setting rules that help reduce barriers to trade, like tariffs (taxes on imports) and other
restrictions. This makes trade fairer, more predictable, and stable for everyone involved.

Ensuring Fairness for All:

The WTO wants to make sure that all countries are treated fairly in trade. It provides a place
where countries can talk and make agreements about trade without any unfair treatment. It aims
to ensure that trade rules are clear, don't favor one country over another, and can be predicted
by everyone.

Resolving Disputes:
When countries have arguments or disagreements about trade, the WTO steps in to help solve
these problems. It has a process for countries to talk through their issues and find solutions
peacefully. This helps prevent trade wars and keeps things calm between countries.

Supporting Development:
The WTO also wants to help poorer countries develop and grow their economies. It gives them
a chance to join the global economy by providing assistance, like advice and training, to help
them trade better with other countries. This support helps them become more involved and
benefit from international trade.

Overview of its Predecessor, the General Agreement on Tariffs and Trade

(GATT):

GATT started in 1948 after World War II to help countries trade better. It wanted to make trade
easier by reducing taxes on goods and other things that made trade harder. It aimed to stop
countries from being too protective about their own goods, which had made the Great
Depression worse in the 1930s.

Important things about GATT:

GATT had meetings where countries talked and agreed on trade rules. The most important one
was in Uruguay in 1994. GATT mostly focused on lowering taxes (called tariffs) on things
countries traded with each other. It also tried to deal with other things that made trade difficult.

GATT's Weakness:
But GATT had some problems. It didn't have strong ways to make sure countries followed the
rules they agreed on. It also didn't have the best system to solve arguments between countries
about trade.

Moving to the WTO:

So, later on, GATT changed into something called the World Trade Organization (WTO). The
WTO was a bigger and better version. It still did what GATT did, but it also started dealing
with services and new things like intellectual property. The WTO made stronger rules and ways
to make sure countries followed them. It was like an upgrade to GATT, making trade rules
better and more enforceable for everyone.

2. Structure and Governance of the WTO:

The WTO has some important groups that help make decisions about world trade. These are
like teams of countries working together.

Ministerial Conference:
This is the highest group in the WTO. Ministers from all countries meet every two years to talk
about trade stuff. They decide on things like trade rules and what needs to be done in the future.

General Council:
When the Ministerial Conference isn't meeting, the General Council takes care of things. It's
made up of representatives from all countries and oversees how the WTO works. It's like a
team that handles decisions on behalf of the Ministerial Conference.

Dispute Settlement Body (DSB):

This group deals with arguments between countries about trade. Representatives from all
countries work together to solve these arguments by following rules set by the WTO.

Different Groups for Different Things:

Inside the WTO, there are smaller teams that focus on specific areas, like goods, services, or
rules for inventions. They keep an eye on how countries are doing in these areas and discuss
ways to improve.

How Decisions Are Made:

In the WTO, countries don’t vote to decide things. They talk and try to agree on everything.
It’s called a consensus – everyone agrees on a decision together.

How They Decide:

During the Ministerial Conference, the big decisions are made. All countries need to agree on
new rules or changes to old ones. Between these meetings, smaller groups like the General
Council and other teams work together to make everyday decisions. They talk a lot to reach
agreements that everyone is happy with.

Solving Arguments:
When countries argue about trade, the DSB helps them sort it out. They talk, have hearings,
and review things. They try to come to an agreement that everyone can accept.

Why It Matters:
The WTO works together this way to make sure everyone has a say and that decisions are fair
for all countries. This teamwork helps countries trade better and solve.

3. Functions and Core Principles of the WTO:

The WTO helps countries make deals to trade better with each other. It has a few important
things it does to make sure trade is fair and easy for everyone.

Making Trade Agreements:

Countries in the WTO talk and make agreements to trade things like goods, services, and ideas.
They try to make it easier to trade by reducing taxes on goods, helping services flow smoothly
between countries, and protecting ideas (like patents).

Solving Arguments:
Sometimes countries have fights about trade. The WTO has a way to help them talk and solve
these fights. They look at the rules and decide who's right based on those rules.

Watching and Helping:

The WTO keeps an eye on how countries trade with each other. They check if everyone follows
the rules they agreed upon. They also help countries that are new or need help with trading, by
giving advice and training to make them better at it.

Important Rules Everyone Follows:

Treating Everyone Fairly: Countries in the WTO promise to treat each other equally when
it comes to trade. They can’t give special treatment to one country over another.
Being Open About Trade: Everyone needs to share information about their trade rules so
that everyone knows what to expect.

Making Trade Predictable: The WTO wants trade to be steady and predictable for
countries. Clear rules help everyone know what to expect when trading.

Playing Fair: Countries agree not to do things that could make trade unfair. They try not to
use things like special help (called subsidies) that might change the trading game unfairly.

4. Trade Negotiations and Agreements within the WTO:

The WTO holds meetings where countries talk and agree on ways to trade things like goods,
services, and ideas. These meetings focus on different topics in each round to make trade easier.

Big Deals in Past Rounds:

Uruguay Round (1986-1994): This meeting was a big deal! It led to creating the WTO. They
made agreements like reducing taxes on goods (tariffs), dealing with farm trade, and protecting
ideas (like patents).

Doha Development Agenda (2001-Present):

Another meeting started in 2001. It's about helping poorer countries trade better. They talked
about making services like banking and education easier to trade and worked on making it
simpler to sell things like clothes and machines between countries.

Specific Agreements for Different Things:

Tariffs: These are taxes on goods. The WTO tries to make these taxes lower so countries can
trade more easily.

Services: The WTO helps make rules for trading services like banking or healthcare between
countries.

Intellectual Property: This means protecting ideas and inventions. The WTO makes rules
to protect these rights globally.
Agriculture: They try to make trade in farm products fairer by dealing with things like farm
subsidies and making it easier for farmers to sell their products.

Big Challenges:
Sometimes it's hard for countries to agree on everything. The Doha meeting had some problems
because countries had different ideas about what was most important. This made it difficult to
finish agreements on certain things.

5. Dispute Settlement Mechanism within the WTO:

The WTO helps countries solve arguments about trade in a fair way. Here's how they do it:

Talking First:
When countries have a problem, they talk about it for about two months to try to solve it. They
sit down and chat to see if they can find a solution between themselves.

Getting Experts Involved:

If they can't agree, the country that's upset can ask for a team of experts to look at the problem.
The WTO sets up this team, and these experts check all the details of the argument.

Listening and Deciding:

The expert team listens to both sides, looks at evidence, and then writes a report with their
findings. They give suggestions on how to fix the issue.

Checking Again (Optional):

If one country doesn't agree with what the expert team says, they can ask another group called
the Appellate Body to look at the problem again. This group checks if the rules were followed
correctly.

Following the Rules:

When everyone agrees with the experts' decision, countries have to change their rules to follow
what was decided. If a country doesn't change its rules, the other country might get permission
to make things harder for them in trade.

Notable Trade Disputes and Their Resolutions under the WTO:

 Airbus-Boeing Dispute:
The US and EU had a big argument about whether they were giving unfair help (called
subsidies) to their aircraft companies, Airbus and Boeing. The WTO said both sides were
giving illegal help, so they allowed each side to put extra taxes on certain goods from the other
country.

Plain Packaging of Tobacco Dispute:

Australia wanted plain packaging for tobacco products to help people's health. Some countries
making tobacco products didn't like this rule. The WTO said Australia could make this rule
because health is more important than trade.

Rare Earth Elements Dispute:

China had rules that made it harder to sell special minerals needed for high-tech things. Other
countries didn't like this. The WTO said China's rules broke trade rules, so China had to change
its rules about selling these minerals.

6. Challenges and Criticisms Faced by the WTO:

Stuck Negotiations:
It's hard for all countries to agree on new trade rules, especially in areas like farming or services.

Less Teamwork:
Countries are making more deals with just one or a few other countries instead of agreeing on
rules together with everyone. This makes trade rules different and weaker.

Problems in Solving Arguments:

There are issues with a group called the Appellate Body not working well. They haven't been
able to make decisions on some arguments between countries, making things unclear.

Unequal Benefits:
Not all countries get the same benefits from trade. Some smaller or poorer countries don't get
as much help from trade agreements as bigger or richer countries.
 More Protectionism:
Big countries are putting more rules to protect their own businesses, making it harder to trade
fairly

Criticisms against the WTO:

Not Fair for Everyone:

Some say WTO rules benefit richer countries more, leaving smaller ones with fewer
advantages.

Tough for Developing Countries:

Poorer countries might not get enough help from trade deals, making it hard for their businesses
to grow.

Not Transparent:
Some think that powerful countries have more say in making rules, and the process isn't clear
for everyone.

Ignoring Environment and People:

The focus on trade sometimes makes it tough to set rules to protect the environment and
workers' rights.

Weak Enforcement:
People say the WTO doesn't have strong ways to make sure countries follow the rules they
agree upon.

7. Reform Efforts within the WTO:

Ongoing Initiatives:

Updating Rules:
People are working to make trade rules better for today's world. They want rules that cover
things like online trade, protecting the environment, and making trade fair for everyone.
 Fixing Dispute System:
There are ideas to make the group that solves arguments between countries (the Appellate
Body) work better. They want to make sure it works well and everyone is happy with how it's
run.

Changing Development Plans:

They're thinking about changing plans for helping poorer countries trade better. They want to
focus on things that matter more now for the world's economy.

Making Things Clearer:

People want the way they make trade rules to be more open and fair for everyone. They want
everyone to know what's going on and have a say in making rules.

Including Environment and People:

There are talks about adding rules about protecting nature and making sure workers have good
conditions in trade deals. They want trade to help the world in a good way, not harm it.

Future Prospects of the WTO:

Adapting to Changing Trade Dynamics:

The WTO needs to adapt to emerging trade challenges, including technological advancements,
shifting supply chains, and evolving trade patterns influenced by geopolitical tensions.

Revitalizing Multilateralism:
Strengthening the WTO's role as a platform for multilateral negotiations to overcome the
proliferation of bilateral and regional trade agreements, promoting a more cohesive global
trading system.

Addressing Development Disparities:

Prioritizing the needs of developing countries to ensure that they benefit equitably from global
trade, enhancing their capacity to participate effectively in the international trading system.

Enhancing Dispute Resolution Mechanisms:

Reforms aimed at restoring the functionality of the dispute settlement system to ensure timely
resolution of disputes and maintain the credibility of WTO rulings.
 Navigating Geopolitical Challenges:
Addressing trade tensions between major economies by encouraging dialogue and negotiation
to prevent escalating disputes that could undermine global economic stability.

Conclusion:

The World Trade Organization (WTO) aims to facilitate global trade by providing a forum for
member countries to negotiate trade agreements, settle disputes, and ensure trade flows
smoothly. As of my last update in January 2022, the WTO continues to play a significant role
in global trade, but faces challenges related to ongoing trade tensions, issues with dispute
resolution mechanisms, and adapting to changes in the global economy. The future of the WTO
might involve reforms to address these challenges and strengthen its effectiveness in governing
international trade.