What are the issues of the WTO

Goals, tasks and principles

The World Trade Organization ("World Trade Organization" = WTO) was founded in Geneva in 1995 as the successor to the GATT agreement ("General Agreement on Tariffs and Trade").

From 1947 until the founding of the WTO, the GATT determined the regulation of international world trade for 48 years. The main goal of the GATT was the substantial dismantling of tariffs and other trade barriers as well as the safeguarding and structuring of free, unhindered international trade relations.

The specific design of the trade policy took place in the eight rounds of GATT negotiations. The focus was initially on the dismantling of tariffs and quantitative restrictions. Until the early 1970s, however, there was so much need for reform and expansion of the trade rules that their further development was given greater weight.

With the conclusion of the "Uruguay Round" (1986 to 1994) and the establishment of the WTO, international cooperation in the field of trade policy was extended to other important areas. In addition to the regulations for trade in goods (GATT), the WTO mainly summarizes the service law (GATS), in part intellectual property law (TRIPS) and state aid law, as well as public procurement law (GPA) as a plurilateral agreement.

goals and tasks

The goals of the WTO are the greatest possible transparency of the trade policies of its members, the agreement, compliance with and monitoring of the common multilateral trade rules as well as the ongoing liberalization of world trade through the reduction / abolition of tariffs and other trade barriers as well as the simplification of customs procedures, which ultimately help to strengthen economic power and Competitiveness should lead. The special development interests of the poorer and poorest members are particularly taken into account.

The tasks of the WTO can be broken down into three pillars:

  • Forum for negotiations between its members on the dismantling of trade barriers:

    As part of the fourth ministerial conference in the Gulf State of Qatar, the "Doha Round", the aim was to strengthen the world trade order, further promote market opening and at the same time improve the integration of developing countries into the world economy.

  • Monitoring of the WTO agreements as well as the national trade policies of the WTO members:
    This takes place in the committees of the WTO, where notifications from WTO members on individual agreements are examined and interpretations of individual obligations are discussed, as well as through the periodic trade policy reviews of WTO members. In addition, the WTO, together with the World Bank and UNCTAD, fulfills a G20 mandate to monitor national trade policy measures in dealing with the economic and financial crisis.
  • Dispute settlement in case of violation of WTO agreements:
    Disputes among the members of the WTO regarding the interpretation of the agreements as well as violations of them are dealt with in a separate multilateral body.

Principles

The WTO's multilateral world trade order is based on a number of basic principles, which the members undertake to adhere to when designing their trade policies.

  • Most favored nation treatment (Article 1 GATT): The principle of most favored nation treatment obliges WTO members to immediately and unconditionally grant any other WTO member and its citizens any advantages they grant a trading partner in trade in goods. This applies equally to trade in services (Art. II GATS) and in connection with trade-related aspects of intellectual property (Art. IV TRIPS).
  • National principle (Article 3 GATT): The national treatment principle requires WTO members that foreign goods and their suppliers are not treated less favorably than domestic goods and their suppliers. The multilateral trade order does not prohibit WTO members from protecting their own economy against foreign competition. However, this external protection must have the same effect for everyone.
  • Transparency (Article 10 GATT): Regulations and restrictions on foreign trade should be transparent. The WTO regulations require the publication of these regulations and often stipulate that the WTO members also inform the WTO secretariat of changes (notifications).
  • Liberalization / dismantling of trade barriers: The WTO forms a negotiating forum that serves to dismantle all types of trade barriers. A distinction is made between tariff trade barriers (customs duties) and non-tariff trade restrictions. The latter are, for example, quantitative trade restrictions, import and export licenses, subsidies, discriminatory safety, environmental and health protection regulations as well as excessive administrative regulations.
  • Reciprocity: The WTO establishes a system of multilateral concessions, also known as concessions. As a result of the multilateral trade negotiations, every WTO member is bound by certain framework conditions - such as a certain percentage duty rate for the import of a product. When WTO members enter trade negotiations, they must be guided by the principle of reciprocity. This means that the mutually granted concessions should be of equal weight and balance. The developing countries occupy a special position, from which the industrialized countries should not demand equivalent concessions.