January 1995, the World Trade Organization is an international
body seeking to promote free trade by opening markets through
the elimination of import tariffs. To that end, the organization
administers trade agreements, monitors international trade policy
and acts as a forum for trade negotiations, while striving for
four main goals -- freeing global trade through universally lowered
tariffs, imposing the same rules on all members in order to homogenize
the trade process, spurring competition through lowered subsidies,
and ensuring the same trade concessions for all member nations.
The WTO also provides technical assistance and training for developing
Organization agreements cover intellectual property, goods and
services. The body also oversees member countries' implementation
of actions to lower customs tariffs and other trade
barriers. The WTO works to improve transparency regarding trade
policies by requiring its members to report on their trade laws
and measures as they go into effect.
The WTO grew
out of a provisional legal agreement, the General Agreement on
Tariffs and Trade (GATT). GATT was drafted in Havana, Cuba, in
1948 in an attempt to encourage free trade in the wake of World
War II. Twenty-three nations signed the original GATT agreement.
years later, more than 90 percent of world trade is subject to
the WTO's trade rules, and proponents claim the economic gains
speak to the organization's success.
to the World Bank's 2004 Global Economic Prospects, released Sept.
3, the organization expects developing countries' economies to
grow 4 percent in 2003 and 4.9 percent in 2004 if recovery remains
Bank, which released a statement ahead of the WTO's Cancun talks,
said a trade deal "that addresses the concerns of developing
nations could spur global growth and reduce poverty by as much
as 144 million people by 2015."
apparent success, the organization has been controversial since
its inception. When the WTO replaced GATT, the new organization
was granted a much broader mandate, expanding from simply addressing
trade to covering services and intellectual property agreements.
The organization's focus has also widened to include health and
environmental regulations that can be construed as barriers to
environmental groups and others oppose this broad mandate, saying
it removes power from citizens and individual governments and
places it in the hands of an unelected international authority.
WTO allows companies to try to trump the democratic process in
the United States," Chris McGinn of the Washington-based
Public Citizen Trade Watch told The New York Times. "It gives
them an additional appeal process once a law is passed to try
to undo hard-fought consumer, environmental or health legislation."
In July, the
Brussels-based International Confederation of Free Trade Unions
(ICFTU) also expressed concern over the trade organization's ability
to "overrule democratic national laws" deemed in violation
of trade rules.
In a statement,
the ICFTU -- which, according to its numbers, represents 158 million
workers in 150 countries -- said the WTO "casts aside social
or environmental standards in its agreements" and puts inordinate
emphasis on economic considerations.
The WTO argues
that liberalizing trade is only one of many tenets the organization
as important as freer trade -- perhaps more important -- are other
principles of the WTO system. For example: non-discrimination,
and making sure the conditions for trade are stable, predictable
and transparent," according to a statement on the WTO Web
WTO'S Guiding Principles
way the WTO aims for equal representation among members is by
granting each member country "most-favored nation" status;
when a member country bestows a trade privilege on another nation,
the privilege must be extended to all other member countries.
Another tenet is "national treatment," which behooves
countries to treat foreign imports equally with those produced
nations decide on agreements, and no country has veto power. Agreements
are decided by consensus, although the WTO agreement does allow
for majority voting if a consensus is unreachable.
a consensus rather than majority vote and granting nations equal
representation distinguishes the WTO from many multilateral organizations.
Within the World Bank and International Monetary Fund each country's
vote is weighted according to the country's status in the international
WTO's consensus-building method means trade laws can be adopted
quickly, critics point out that it grants power to those wealthier
nations with the resources to devote to treaty negotiation.
common way for member nations to make the consensus-building approach
work more in their favor is through the formation of alliances.
By April, the WTO had 146 members with over 30 applicants (WTO
"observers") awaiting full membership. Among the 146
member countries, several alliances work in concert to achieve
mutually beneficial results. Some work with one spokesperson or
negotiating team to push a decision through.
alliance is known as the Quad, or Quadrilaterals, and includes
the body's four largest members: Canada, the European Union, Japan
and the United States. Other groupings include the Association
of South East Asian Nations (ASEAN), the Cairns Group and the
African, Caribbean and Pacific Group. Some alliances are regional,
others focus on a specific issue.
Group, for example, was formed in 1986 as a way to argue for the
liberalization of agricultural trade. Cairns Group members share
the common view that they are unable to compete with larger, wealthier
nations in domestic and export subsidies, and enjoy increased
power through membership in an alliance.
member governments head the WTO, most countries have a diplomatic
mission at the organization's Geneva headquarters, and some appoint
a special ambassador to the organization.
director general is currently Supachai Panitchpakdi, who took
over the position in September 2002 and will remain in the post
until August 2005. The Right Honorable Mike
Moore preceded Panitchpakdi, serving from September 1999 to August
highest decision-making body is the Ministerial Conference, which
The next level
is the General Council, which meets at the organization's Geneva
headquarters a few times a year. Such meetings usually involve
delegation heads and ambassadors based in Geneva, although delegates
occasionally travel to Switzerland to participate, bringing trade
policies and negotiating positions from their home countries.
The General Council also acts as the Dispute Settlement Body and
the Trade Policy Review Body.
General Council are the Intellectual Property Council, Goods Council
and Services Council. And finally, each agreement calls for various
working groups and committees to hammer out regulations.
there is another level of decision-making -- informal discussion
that is often necessary in order to create consensus in committees
and larger meetings. The importance of such discussions is recognized
on the trade body's Web site: "Informal consultations in
various forms play a vital role in allowing consensus to be reached,
but they never appear in organization charts. They are necessary
for making formal decisions in the councils and committees."
committee leaders play a vital role in building consensus among
members. Because of this, the General Council approves new chairpersons
for the major WTO bodies each year, and attempts to represent
regions equally in such appointments.
By Jessica Moore, Online NewsHour