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BACKGROUND
During great depression of 1930s the
international trade was badly affected and
various countries imposed import restrictions
for safeguarding their economies.
It resulted in sharp decline in world trade.
NON DISCRIMINATION
A contracting partys trade policies must treat all GATT
members equally.
No member country shall discriminate between the
members of GATT in the conduct of international trade.
Members of GATT agree to apply the principle of most
favored nation to all import and export duties.
National Treatment : Foreign goods, services, or
investment are to be treated no less favorably within
a nations domestic markets than competing products or
services produced locally.
The 8th round was entirely different from the previous rounds because it
included a number of new subjects for consideration. This 8th round was
known as URUGUAY ROUND.
The discussions at this round only gave birth to WORLD TRADE
ORGANISATION (WTO).
WTO
Functions of WTO:
WTO is based in Geneva, Switzerland. Its functions are:
Administering the multilateral trade agreements which together
Principles of WTO
Non discrimination
Free Trade: Promote free trade between nations through
negotiations.
Stability in the trading system: Member countries are
committed not to raise tariff and non tariffs barriers
arbitrarily.
Promotion of Fair Competition: WTO provides for
transparent, fair and undistorted competition.
It discourages unfair competitive practices such as export
subsidies and dumping.
of the patent
Patents
Copyright and other related Rights
Geographical Indications
Industrial Designs
Trade marks
Layout design of integrated circuits
Undisclosed information including trade secrets
Mode 2:
Consumption
abroad
Mode 3:
Commercial
presence
Supplier Presence
Service supplier
present within the
territory of the
Member
Evaluation of WTO
The WTO members now account for over 97% of the
international trade indicating the potential of bringing
about an orderly development of international trade.
Benefits of WTO:
GATT / WTO has made significant achievements in
reducing tariff and non tariff barriers to trade. Developing
countries too have been benefiting significantly.
Liberalization of investments has been fostering economic
growth of a number of countries.
It has a system in place to settle trade disputes between
nations.
It has a mechanism to deal with violation of trade
agreements.
Drawbacks:
Negotiations and decision making in the WTO
are dominated by the developed countries.
Many developing countries do not have the
financial and knowledge resources to
effectively participate in WTO discussions and
negotiations.
Due to the dependence of developing countries
on the developed ones, the developed
countries are able to resort to arms twisting
tactics.
- Stability of access
the application of uniform rules in key areas of the trading process e.g. customs valuation,
import licenses etc.