Gilpin observed that the establishment of the World Trade Organization (WTO) on January 1, 1995 as the principal forum for trade liberalization marked the biggest reform of the international trading system since the end of the Second World War. In this paper, I will provide an analysis of the evolution of the international trading system from its inception as the General Agreement on Tariffs and Trade (GATT) to its incarnation as the World Trade Organization (WTO), taking into account the changing international economic environment and political realities. This paper comprises of three parts. The first part outlines the historical context in the creation of GATT; the second part gives a brief synopsis of its structure and functions, with the third covering the paradigm shift in events that brought into existence the WTO intended to regulate an ever increasingly market-oriented global economy. Established in 1944 and taking its name from the New Hampshire town where the agreements were drawn up, the Bretton Woods conference was a gathering of finance ministers from Allied countries following the end of the Second World War. Under American leadership, the group met to discuss the failings of World War I’s Treaty of Versailles and the creation of a new international monetary system which could fund post war reconstruction, economic stability and facilitate international trade. This conference led to the establishment of two of the most important post war economic institutions, the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development, now known as the World Bank (An introduction to the WTO and GATT, pp. 42, 2003). Originally, the architects of the international trade system in the post war ... ... middle of paper ... ...requests from other members and notify the WTO of changes to its trading policies. This clause is provided to help improve predictability and stability to the international trading system and discourage the use of quotas and other measures used to limit the quantity of imports. Today, the WTO membership numbers 146 which comprises of approximately 97 per cent of the worlds’ trade (www.WTO.org). The evolution of GATT to the WTO was a significant step towards liberalising markets and ushered in a new era of free trade. Although the WTO is still a relatively young international institution, its origins are rooted in the Bretton Woods conference following the end of World War II. The WTO has evolved to cover areas such as trade in goods and services as well as Intellectual Property Rights (IPR) and continues to provide the key disciplines affecting international trade.
The July 1944 United Nations Financial and Monetary Conference, known as the Bretton Woods Conference, who created the International Monetary Fund (IMF) and the forerunner of the World Bank, the International Bank for Reconstruction and Development (IBRD). The “Bretton Woods system” was bolstered in 1947 with the addition of the General Agreements on Tariffs and Trade (GATT), forerunner of the World Trade
Following the Uruguay Round of multilateral trade negotiations, The World Trade Organization (WTO) was established in 1995 as the successor to the General Agreement on Tariffs and Trade (GATT). The WTO is an international organization that watches over trade relationships between nations dealing with goods, services, intellectual property and investments. The main function of the WTO is “to ensure that trade flows as smoothly, predictably and freely as possible” (“The World Trade Organization”). The WTO helps international cooperation by providing countries with a fair forum for resolving disputes over trade issues. Member countries bring their trade disputes to the WTO rather than acting unilaterally. The organization also strives to lower the cost of living and boost economic growth by reducing protectionism and promoting freer trade. Member countries enjoy the security the trading rules provide, but they are required to commit to opening their markets and abiding by the commitments they agreed to.
After the failed International Trade Organization, Rodrik discusses the Bretton Woods Agreement, the transition from the General Agreement on Tariffs and T...
The GATT grew primarily from a need to reduce or eliminate global tariffs after WWII and oversee the multilateral trading system between multiple countries. After the WTO was created it expanded this role to include lowering trade barriers and become the mediator of global trading disputes and the WTO aims to achieve its goals by non-discrimination, being predictable and transparent, allowing for more competition by discouraging unfair practices, providing assistance to help developing countries, and by protecting the environment, public health, animal health and plant health as much as possible through its
The WTO was born out of negotiations, and everything the WTO does is the result of negotiations. The bulk of the WTO’s current work comes from the 1986–94 negotiations called the Uruguay Round and earlier negotiations under the General Agreement on Tariffs and Trade (GATT). The WTO is currently the host to new negotiations, under the ‘Doha Development Agenda’ launched in 2001.Where countries have faced trade barriers and wanted them lowered, the negotiations have helped to open markets for trade. But the WTO is not just about opening markets, and in some circumstances its rules support maintaining trade barriers — for example, to protect consumers or prevent the spread of disease.
3. Dijck P. van, and Faber, G. (eds.), Challenges to the new World Trade Organization, 299-306 1996 Kluwer Law International
The World Trade Organization was developed in 1995 out of what was known as the Uruguay Round. Although GATT set rules they mostly dealt with issues just involving simple trade of goods and the distribution of tariffs. The WTO has a more broad job than the GATT; “…it oversees multilateral agreements relating not just to good, but...
Terborgh, Andrew. "The Post-War Rise of World Trade: Does the Bretton Woods System Deserve Credit?” Department of Economic History, London School of Economics. Sept. 2003: p. 1-73.Web. 13 Apr. 2014. .
The World Trade Organization’s principles should be supported and embraced. The WTO is a large step in the right direction to globalization. The long term benefits of free trade far outweigh only argument critics can come up with, which are short-term economic losses. The WTO is structured in a way that every member country is treated fairly and if not they can safely argue and settle disputes. The potential for new markets for all business world-wide are also great, and this in itself should be enough for any person to agree with its necessity.
the effect that the work of the IMF and the World Bank have had on the
Global trade occurs between many nations. While the intent of free trade is just that for trade to occur freely without government intervention in the open market. The truth is that governments do intervene in free trade imposing many sanctions, tariffs, quotas and other economic policies to limit free trade. To better regulate governments role in free trade a General Agreement on Tariffs and Trade (GATT) was created in 1947 (Carbaugh, 2011, p. 191). GATT helped trade by having all nations, included in the original group, trade on mutually beneficial policies. GATT has since been replaced by the World Trade Organization (WTO) that still honors many policies of GATT that now includes 153 nations that is inclusive of 97% of all world trade.
The WTO agreements have shifted and now focus on multilateral trading system from the reduction of trade barriers in reducing tariffs to one of “positive rule-making”. The agreement established requires that all members countries conform to the rules and regulation of the WTO. For example, the WTO settlement process allows disputes to resolution panels to declare municipal laws and regulations as illegal trade barriers. This means any member country caught going against WTO rules would have to be punished and this can be in the fo...
For this reason, sometimes friction between countries can occur, because not only does trade provide thousands of jobs, but in some cases the competition between countries may also lead to the lay-off of employees. Thankfully, there are regulations set in place that state that these countries bring their complaints to the WTO. By doing such, negotiations between the nations can occur rather than the grieving country acting on impulse. According to the WTO’s website, more than 400 disputes have been brought to the WTO since established in 1995, whereas before World War II there was not a medium in place for international trade negotiations. It also states that, “The increasing number of disputes brought to the WTO does not reflect increasing tension in the world. Rather, it reflects the closer economic ties throughout the world.” Klaus Kautzor Schroder, author of the article, "Frequently Asked Questions... About The World Trading System," states that the degree of access for developing countries starts out small as it depends on their development, financial, and trade needs. However, the WTO’s expanding membership proves the fact that nations continue to have faith in the WTO as many people feel that the advantages in trade caused by the WTO outweigh the disadvantages by far. Because of this, the World Trade Organization
The WTO was formed on first January, 1995 to deal with liberalize global market. This organization replaced an old organization which formed immediately after the World War II to address the economic challenges which the world was facing that time after the war. These challenges are; unemployment, unfair trade, investment challenges and disputes among different nations. This organization was called international trade organization. It was formed alongside other global development agencies i.e. international monetary fund and the World Bank. These two i.e. World Bank and IMF focused on development agenda and ITO on trade. However, ITO did not get the approval of few nations so that to become a global organization under the United Nations that was purely to dealing with trade (McMichael ,22). Due to lack of global appeal and approval, the ITO went under, and General Agreement on Tariffs and Trade (GATT) replaced it. This is because the GATT seems to be an easy way to get global appeal and it could deal with the current events without manipulation from any or...
International organizations create space for its members to coordinate interests and actions which helps promote interdependent relationships among them and strengthens their legitimacy. As society has progressed, it has globalized, and in the past 50 years states have had to address their growing dependence, especially in the economic sector. The World Trade Organization (WTO), is an institution which has an immense impact on the international political economy and the way states function within the international system. It organizes agreements and treaties which govern how its members decide policies, tariffs, and keeps states accountable for their actions. For example, the General Agreement on Tariffs and Trade (GATT), determines how states can regulate their import and exports. (Hurd 2014,