Overview of the Multilateral Trading System and Introduction to the basic principles of the WTO

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WORLD TRADE ORGANIZATION-

• Overview of the Multilateral Trading System and
  Introduction to the basic principles of the WTO

Said El HachimiExternal Relations Division WTO
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• What is the WTO?
• WTO major contribution is Dispute Settlement
• Principles
• WTO as a Forum for negotiations
• WTO Decision making
• WTO and other Stakeholders
• Parliamentarians
• Non-Governmental Organizations.

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What is the WTO?
500 pages of (Agreements) Rules/
23,000 pages of Commitments
A set of International Trade Rules agreed by
Members through Negotiations
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Only Multilateral Set of Trade Rules

• General Agreement on Tariffs and Trade 1994.
• General Agreement on Trade in Services.
• Trade-Related Aspects of Intellectual Property.
• Dispute Settlement Understanding.
• Trade Policy Review Mechanism.
• Plurilateral Agreements.

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• WTO major contribution is Dispute Settlement

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WTO Dispute Settlement

• Enforcement of trade rules.
• Cases brought up by Members
• Basis of any case is violation of commitments by
  a Member vis a vis other Member in the WTO

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WTO Dispute Settlement Clear rules and
timetables.

• How long to settle a dispute?
• 60 days Consultations, mediation, etc45
  days Panel set up and panellists appointed6
  months Final panel report to parties3
  weeks Final panel report to WTO members60
  days Dispute Settlement Body adopts report (if no
  appeal)
• Total 1 year (without appeal)
• 6090 days Appeals report30 days Dispute
  Settlement Body adopts appeals report
• Total 1y 3m (with appeal)

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WTO Dispute Settlement

• Priority Settle disputes through consultations.
• Dispute Settlement Body.
• Panel process.
• Appellate Body.
• Rulings are binding and automatically adopted.

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WTO Principles
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WTO Principles

• Non-discrimination
• Members cannot discriminate between trade
  partners.
• Exceptions Free trade agreements, tariff
  preferences for developing-country products, GATT
  Article XX and trade remedies.
• National treatment
• Imported and domestic goods should be treated
  equally.
• Applies only when the product or service has
  entered the market.

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WTO Principles

• Freer trade
• Through negotiations.
• Gradually lower trade barriers.
• Progressive liberalization.
• Stability and Predictability
• Improves business and investment environment.
• Commitments at the WTO are binding.
• Transparency requirements.

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WTO Principles

• Promoting fair competition
• Rules on dumping and subsidies.
• Encourage development and reform
• Flexibilities for developing countries and
  economies in transition.
• Transition periods.
• Technical assistance.

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• WTO is above all a Forum for Negotiations

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• Negotiations on Specific Subjects
• Agriculture
• Trade in Services
• Intellectual Property
• Round of Negotiations
• Several issues negotiated simultaneously.
• Everything is derived from the results of the
  negotiations.

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Without the WTO
The effect of protectionism on world trade,
192933
3.0bn
1929 1930 1931 1932 1933
0.9bn
Trade figures per month
Preliminaries
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With the WTO
Value of world trade 19482003US trillion,
current prices
MORE trade? Of course, but
look at the STABILITY gt
If 67 had been wiped out
1997
Preliminaries
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What is the WTO?

• The first stepis to talk.

Somewhere to negotiate and apply the results
This is where governments go to try to sort out
their trade problems.
WTO not just for liberalizing trade. Sometimes
the rules support trade barriers e.g. to
protect consumers or prevent the spread of
disease.
Skip gtgtgt
Somewhere to talk
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Foremost The WTO is a forum for negotiations
Current negotiations launched4th WTO
Ministerial Conference, Doha, November 2001
Previous round Uruguay Round19861994Eighth
round under GATT, since 1948
Result In 1995 ...
 Rules expanded goods (GATT) services (GATS)
intellectual property (TRIPS)
 WTO formed, replacing GATT
Somewhere to talk
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Foremost The WTO is a forum for negotiations
Current negotiations launched4th WTO
Ministerial Conference, Doha, November 2001
Doha Development AgendaLaunched at Doha
Ministerial ConferenceNovember 2001. Most to end
1 January 2005
 negotiations 20 subjects
 problems with implementation of existing
agreements
see Understanding the WTO page 77
Somewhere to talk
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Foremost The WTO is a forum for negotiations
Agreement only by consensus
Everyone has to be persuaded
No one forced by a majority
Everything else follows from negotiations ...
Somewhere to talk
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CURRENT NEGOTIATIONS
Why so difficult?
ANY DEALhas winners and losers (and lobbies)
QUESTIONIf there are losers,does that mean
dont do it?
RESULTStatus quo. But is that OK?
ALTERNATIVEMake use of the winners gains to
help the losers adjust
Better trade
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CURRENT NEGOTIATIONS
Seeking consensus
EASY OPTION be defensive ...no deal is better
than a bad deal(status quo)
MORE DIFFICULTidentify own interests we
want/dont want
MOST DIFFICULTto move forward What can others
accept? give as well as take gt CONSENSUS
Better trade
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CURRENT NEGOTIATIONS
CURRENT NEGOTIATIONS
Key players, agriculture
Just a sample of groupings
COALITIONS AND MAJORS
Africans, least-developed, ACP (together G90,
but with 64 WTO members)
Cairns Group Australia, NZ, S.Africa, Brazil,
Argentina, Thailand, Philippines, etc
European Union
G10 Switzerland, Norway, Japan, S.Korea,
Ch.Taipei, etc
G20/ India, Brazil, China, S.Africa, etc
G33 Indonesia, etc lobbying for special products
Like minded India, Pakistan, Caribbean, etc
RAMs new members (recently acceded members)
Small island developing states
United States
CONSENSUS-BUILDERS
US-EU (summer 2003)
The Five Australia, Brazil, EU, India, US (summer
2004)
Better trade
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CURRENT NEGOTIATIONS
CURRENT NEGOTIATIONS
Key players, agriculture
Africans, least-developed, ACP (together G90,
but with 64 WTO members)
G20/ India, Brazil, China, S.Africa, etc
G33 Indonesia, etc lobbying for special products
New group Small economies
Press conference in Hong Kong 16 December 2005
Better trade
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CURRENT NEGOTIATIONS
CURRENT NEGOTIATIONS
Key players, agriculture
Or, another way of looking at groups
Better trade
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Better trade
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WTO Decision Making
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WTO Decision Making, what about the
institutionals?

• Member-driven and consensus-based.
• Ministerial Conference
• Topmost decision-making body.
• Meets at least once every two years.
• General Council
• On behalf of the Ministerial Conference.
• Meets in Geneva.
• Councils
• Trade in Goods.
• Trade in Services.
• Trade-Related Aspects of Intellectual Property
  Rights.
• Various Committees.

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WTO and other Stakeholders
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WTO and other stakeholdersParliamentarians

• Elected representatives of the people.
• Constitutional role on trade issues.
• Crucial interface between people, civil society
  and governments.
• WTO outreach activities for Parliamentarians.

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WTO and other stakeholders NGOs

• Strong interest in WTO issues.
• NGO Attendance to Ministerial Conferences.
• Enhanced dialogue with civil society.
• Annual Symposium.
• Briefings for NGOs during WTO Meetings.
• Circulation of NGO Position Papers to WTO Members.

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Registered NGOs in WTO Ministerial Conferences
Ministerial NGOs who attended Number of Individuals
Singapore 1996 108 235
Geneva 1998 128 362
Seattle 1999 686 1500 Approx.
Doha 2001 370 370
Cancún 2003 795 1578
Hong Kong 812 1596
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What about the WTO Secretariat?
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FACT FILE
Location Geneva, Switzerland Established
1 January 1995 Created by Uruguay Round
negotiations (1986-94)   Membership 150
countries Budget 175m Swiss francs,
2006 Secretariat staff 630 Head Pascal Lamy
(director-general) Functions  Administering
WTO trade agreements  Forum for trade
negotiations  Handling trade disputes  Monitorin
g national trade policies  Technical assistance
and training for developing countries  Cooperatio
n with other international organizations
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The World Trade Organization
The World Trade OrganizationCentre William
Rappardrue de Lausanne 154CH1211 Geneva
21Switzerland Tel [phone] Fax 41
(0)22 739 54 58 email enquiries_at_wto.org website
www.wto.org