Question

What is the GATT? What is the WTO? How does the WTO operate? What are its functions? What role has the WTO played relative to global economic integrations?

Answer 1

What is the GATT? What is the WTO? How does the WTO operate? What are its functions? What role has the WTO played relative to global economic integrations?

General Agreement on Tariffs and Trade (GATT) is an agreement between countries to promote international trade and reduce any barriers to it such as tariffs or quotas. Its preamble says its purpose is to "the substantial reduction of tariffs and other trade barriers and the elimination of preferences, on a reciprocal and mutually advantageous basis." It was signed by 23 countries on 30 October 1947. In September 2019, the list contained 36 nations. It includes countries like Australia, Brazil, Belgium, France, India, the UK, the US, etc.

World Trade Organisation is an intergovernmental organization that is concerned with the regulation of international trade between nations. It was officially formed on January 1st, 1995. It provides a framework to countries to negotiate trade agreements and dispute resolution. Studies suggested that WTO boosted trade and trade barriers would be higher in the absence of it. It has 164 member countries including Cambodia, Canada, Austria, the US, etc.

WTO's purpose is to set the rules of the trading game between the countries. It does not define or specify outcomes. It also acts as a platform for negotiating and monitoring trade liberalization, to resolve disputes, and to help developing countries to benefit out of the global trading system.

WTO has 164 countries as members which include developed as well as developing or least developing nations. WTO is formed in keeping the objective of every country in mind. While it helps developed countries to expand their trade across the globe. For developing countries, they provide opportunities to increase trade flows. These countries are also supported in building the infrastructure for WTO work. They also receive treatment, including exemption from many provisions. So WTO tries to bring most countries on a single platform to develop, increase trading activities, and promote world peace.

Like for example, the Doha Round in 2001 was an ambitious effort to make globalization more inclusive and help developing countries by slashing barriers and subsidies in farming. Agenda was to liberalize trade and new rulemaking to facilitate trade.