World Trade Organization. Origins And Characteristics Essay

World Trade Organization. Origins And Characteristics - Essay Example Simultaneously, 23 countries (11 of which were developing nations) decided to negotiate on tariff reductions and also to adapt some of the ITO rules, these agreements are called the GATT. The ITO remained subject to ratification to be accepted by national legislatures, but the USA denied due to Congress opposition, and thus GATT remained in effect just as the ‘provisional’ agreement. Seven trade rounds were completed under GATT, and trade agreements were initiated which benefited the developing countries without reciprocal offers. The GATT agreements were extended in the Uruguay Round in 1986, under which new areas were added to the services trade and intellectual property rights were included. Furthermore, a new dispute settlement system had to be redesigned and a new trade organization had to be established to replace the provisional GATT. In the year 1995, the ‘Marrakesh Agreement’ established the WTO, and the Uruguay Round agreements were implemented and by 1997 the additional agreements were also implemented which covered the financial services and the telecommunication services. Furthermore, the defining characteristics of the WTO are as follows (Ministry of Commerce and MPDF, 2005, 11-16): Transparency is the primary principle, since business people are most concerned with the environment they operate in. Thus, it is a requirement for the WTO member to publish all laws and regulations transparently which may affect domestic or international trade in any matter. Non-discrimination principle ensures that the goods of any country must not be differentiated against, and therefore no ‘most favored nation’ treatment shall not be provided, and neither the local goods should be discriminated. Progressive trade liberalization principle applies because WTO is not a free-trade organization, therefore a government can increasingly open its market to foreign competition to the extent it finds appropriate, independently of what i s prescribed by the WTO agreements. Special and Differential treatment principle ensures that developing nations receive easier terms and agreements, and thus they are allowed more time for implementation, and the stricter rules applied on the developed nations may be removed from the agreement of the poorer nations, in order to help them take benefit of being WTO members receiving special treatment. b) An imperfect World Trade Organization is better than no world trade organization.  Discuss with reference to ongoing protectionist policies and the impact of these in the relation of developed economies and lesser-developed economies (40 points). WTO is an organization that was formulated to help and benefit its members, its system of rules, principles and obligations are in place to protect its member nations, which also comprises of the economically less powerful nations, since WTO helps governments of such nations to devise programs which trigger economic reform. The multilatera l trade framework of the rules enacted also help nations in domestic policy making, they do not enforce trade policies but help governments in establishing developmental policies which are based on open and competitive markets. Regardless of the initial aim, WTO has been criticized for being unfair and hurting to