Overview: World Trade Organization (WTO)
As the success of GATT (the General Agreement on Tariffs and Trade), the World Trade Organization (WTO) was established in 1995 to promote global free trade and deal with the rules of trade between nations at a near-global level.
Currently, the WTO consists of 151 members. Its structure can be divided into four levels: the Ministerial Conference, the General Council, the Councils for Trade, and the Subsidiaries bodies. Being the topmost level of all, the Ministerial Conference meets at least every two years to make decisions on all matters under any of the multilateral trade agreements. The General Councils, the WTO’s highest-level decision-making body, meets regularly to carry out the functions of the WTO. The next level down is the Councils for Trade, which works under the General Council, with three different councils working in different fields. Lastly, we have the Subsidiaries bodies under each of the three councils.
The principles that the WTO are that the trading system should be:
1. Without discrimination
a. “A country should not discriminate between trading partners (giving them equally “most-favored-nation” or MFN status); and it should not discriminate between its own and foreign products, services or nationals (giving them “national treatment”)”
2. Freer
a. “barriers coming down through negotiation”
3. Predictable
a. “foreign companies, investors and governments should be confident that trade barriers (including tariffs and non-tariff barriers) should not be raised arbitrarily; tariff rates and market-opening commitments are “bound” in the WTO”
4. ...