lbs wto final

8/8/2019 LBS WTO final

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SCOPESCOPE WHAT IS WTOWHAT IS WTO

STRUCTURE & PROCESSESS

MINISTERIAL CONFERENCES

AGREEMENTS

INDIAN CONTEXT

IMPLICATIONS


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WTO GENESISWTO GENESISWTO GENESISWTO GENESIS

TheThe GeneralGeneral AgreementAgreement onon TradeTrade andand TariffTariff

(GATT)(GATT) camecame intointo existenceexistence inin 19471947

ItIt soughtsought substantialsubstantial reductionreduction inin tariff tariff andand

otherother barriersbarriers toto tradetrade andand toto eliminateeliminate

discriminatorydiscriminatory treatmenttreatment inin internationalinternational

commercecommerce

IndiaIndia signatorysignatory toto GATTGATT 19471947 alongalong withwith twentytwenty

twotwo otherother countriescountries

EightEight roundsrounds ofof negotiationsnegotiations hadhad takentaken placeplace

duringduring fivefive decadesdecades ofof itsits existenceexistence


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HISTORY WTOHISTORY WTO GATT THE PARENT ORGANIZATION.GATT THE PARENT ORGANIZATION. CAME INTO FORCE ON 1CAME INTO FORCE ON 1STST JAN 1995.JAN 1995.

RESULT OF URGUARY ROUND (1986RESULT OF URGUARY ROUND (1986--1994)1994)

DEVELOPED NATIONSDEVELOPED NATIONS

FORMED MAJORITYFORMED MAJORITY

LESS WIDER SCOPELESS WIDER SCOPE

PROVISIONAL TREATYPROVISIONAL TREATY

TOLERATEDTOLERATED

PROTECTIVE POLICIESPROTECTIVE POLICIES

IN SENSITIVEAREAS eg.IN SENSITIVEAREAS eg.Anti Dumping, subsidiesAnti Dumping, subsidies

MORE GLOBAL MEMBERSHIPMORE GLOBAL MEMBERSHIP

WIDER SCOPEWIDER SCOPE

FULL FLEDGED INTERNATIONALFULL FLEDGED INTERNATIONALORGANISATIONORGANISATIONIN ITSELFIN ITSELF

ADMINISTERS UNIFIED PACKAGESADMINISTERS UNIFIED PACKAGESOF AGREEMENTSAGREED BY ALLOF AGREEMENTSAGREED BY ALL

REVERSED POLICIES OFREVERSED POLICIES OF

PROTECTION IN CERTAINPROTECTION IN CERTAINSENSITIVEAREAS eg exportSENSITIVEAREAS eg exportrestraints ontextile & clothing torestraints ontextile & clothing tobe dismantledbe dismantled

GATT vs WTOGATT vs WTO


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FinallyFinally Whatis WTO?Whatis WTO?ItIt is the onlyinternational organizationdealing withthe rules of trade betweennations. Atits heart are the WTO

agreements, negotiated and signed bythe bulk of the worlds trading nationsand ratifiedintheir parliaments. The

goalis to help producers of goods andservices, exporters, andimportersconducttheir business.


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TRIVIATRIVIAFORMATION :FORMATION : 1 JAN 19951 JAN 1995

HEADQUARTERS :HEADQUARTERS : GENEVA, SWITZERLANDGENEVA, SWITZERLAND

MEMBERSHIP :MEMBERSHIP : 150150 ( INCLUSION VIETNAMON 11 JAN 07)( INCLUSION VIETNAMON 11 JAN 07)OFFICIAL LANGUAGE :OFFICIAL LANGUAGE : ENGLISH, FRENCH, GERMAN ANDENGLISH, FRENCH, GERMAN AND

SPANISHSPANISH

BUDGET :BUDGET : 170 MILLION SWISS FRANCS170 MILLION SWISS FRANCS

STAFF :STAFF : 635635

WEBSITE :WEBSITE : WWW.WTO.INTWWW.WTO.INT

DIRECTOR GENERAL :DIRECTOR GENERAL : PASCAL LAMIPASCAL LAMI


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STRUCURE AND PROCESSESSSTRUCURE AND PROCESSESS


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STRUCTUREOF WTOSTRUCTUREOF WTOSTRUCTUREOF WTOSTRUCTUREOF WTOMC( MINISTERIAL CONFERENCE)MC( MINISTERIAL CONFERENCE)

(EXECUTIVEOF WTO)(EXECUTIVEOF WTO)

GENERAL COUNCILGENERAL COUNCIL

PERFORMS FUNCTIONSPERFORMS FUNCTIONS OF MC DURING INTERVALOF MC DURING INTERVAL

FRAMES RULES AND PROCEDURESFRAMES RULES AND PROCEDURES FOR FUNCTIONAL COUNCILSFOR FUNCTIONAL COUNCILS TO DISCHARGETO DISCHARGERESPONSIBILITIESOF DISPUTESSETTLEMENTRESPONSIBILITIESOF DISPUTESSETTLEMENT BODYBODY

TO DISCHARGETO DISCHARGERESPONSIBILITIESOF TRADEPOLICY REVIEWRESPONSIBILITIESOF TRADEPOLICY REVIEW MECHANISMMECHANISM

(TPRM)(TPRM)

FUNC

TIO

NALCO

UNC

ILS

FUNC

TIO

NALCO

UNC

ILS

TRADE INTRADE IN GOODSGOODS

TRADE INTRADE IN SERVICESSERVICES

TRIPSTRIPS


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DECISION MAKINGDECISION MAKINGDECISION MAKINGDECISION MAKING

BY CONSENSUSBY CONSENSUS

REACHED BY VOTING,REACHED BY VOTING, EACH COUNTRY HAS ONEEACH COUNTRY HAS ONE

VOTEVOTE MC AND GC HASMC AND GC HAS EXCLUSIVE INTERPRETATIONEXCLUSIVE INTERPRETATION

POWERPOWER OF MTA, AGREEMENT ESTABLISHINGOF MTA, AGREEMENT ESTABLISHINGWTOWTO

INTERPRETATION ISINTERPRETATION IS ADOPTED BY CONSENSUSADOPTED BY CONSENSUSOR 3/4 MAJORITYOR 3/4 MAJORITY OF MEMBERSOF MEMBERS

MC CAN WAIVE OBLIGATIONMC CAN WAIVE OBLIGATION UNDER MTAANDUNDER MTAAND

OTHER AGREEMENT BY 3/4 MAJORITY OFOTHER AGREEMENT BY 3/4 MAJORITY OF

MEMBERSMEMBERS


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DISPUTESETTLEMENT

CONSULTATIONCONSULTATION

ESTABLISHMENT OF A PANELESTABLISHMENT OF A PANEL

PANEL EXAMINATIONPANEL EXAMINATION

ADOPTION OF PANEL REPORTADOPTION OF PANEL REPORT

APPELLATE REVIEWAPPELLATE REVIEW

IMPLEMENTATIONIMPLEMENTATION


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MINISTERIAL CONFERENCESMINISTERIAL CONFERENCES


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MINISTERIAL CONFERENCES

HIGHEST DECISION MAKING BODYHIGHEST DECISION MAKING BODY

HELD ONCE IN 2 YEARSHELD ONCE IN 2 YEARS

MEETINGS HELDMEETINGS HELD

SINGAPORE, 9SINGAPORE, 9--13 DECEMBER 199613 DECEMBER 1996

GENEVA, 18GENEVA, 18--20 MAY 199820 MAY 1998

SEATTLE, NOVEMBER 30SEATTLE, NOVEMBER 30 DECEMBER 3, 1999DECEMBER 3, 1999

DOHA, 9DOHA, 9--13 NOVEMBER 200113 NOVEMBER 2001

CANCN, 10CANCN, 10--1414 SEPTEMBER 2003SEPTEMBER 2003

HONG KONG, 13HONG KONG, 13--18 DECEMBER 200518 DECEMBER 2005


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PROGRESS THROUGH MINISTERIALPROGRESS THROUGH MINISTERIAL

CONFERENCESCONFERENCES

Assess the implementation of commitments underthe WTO Agreements and decisions;

Review the ongoing negotiations and Work

Programs;

Examine developments in World Trade; and

Address challenges of evolving world economy.

Singapore IssuesSingapore Issues..

Foreign Investments.Foreign Investments.

Competition Policies.Competition Policies.

Govt ProcurementGovt Procurement

Trade Facilitation.Trade Facilitation.


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Second Ministerial Conference at GenevaSecond Ministerial Conference at Geneva

Focused on the review of the 50 years ofFocused on the review of the 50 years of

working of the system.working of the system. Expressed concerns over marginalization ofExpressed concerns over marginalization of

LDC and small economies.LDC and small economies.

Third Ministerial Conference In SeattleThird Ministerial Conference In Seattle..

Largest ever global conference on tradeLargest ever global conference on trade 135135

Countries.Countries.

It failed because of :

Bulkiness of the agenda on record. No progress was on the areas of agriculture,

services and intellectual property.

The developing and Least Developed Nations

were sidelined in the negotiations.


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Fourth Ministerial Conference In DohaFourth Ministerial Conference In Doha..

Fifth Ministerial Conference In Cancun.

Meeting held to break the deadlock of trade liberalisation

and fast track implementation of Doha talks.

To address imbalance in agricultural trade.

Talks collapsed as disagreement on Singapore Issues and

internal conflict between EU members.

Draft text did not reflect the concerns of developing and the

Least Developed nations.

Doha Development Agenda (DDA) was adopted, a blueprint

for the development of developing countries.

Crucial to bolstering international economic growth andhelping developing countries integrate into the global

economy.

Substantial increase in market access.

Reduction of all export subsidies. Substantial reduction in trade distorting domestic support.


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Revised Framework at Geneva 2004.

Key issues agriculture, tariff and custom

procedure. Foundation for the new treaty.

Balanced agreement.

Level playing field in agriculture.

147 members were in favour.

Sixth Ministerial Conference In Hong Kong.

Agenda. Implementation of Doha Development

Round. Differences Over Three Key Issues.

Agriculture. Non Agriculture Market Access ( NAMA ). S

ervices.


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Agriculture. Eliminate all forms of subsidies by 2013.

Developing countries allowed to declare appropriate

number of special products on self selection basis. Special Safeguard Mechanism Neutralize effects of

surge in imports.

NAMA.

Concession to developing countries on reduction ofindustrial tariffs.

Draft takes note on Indias recommendation to adopt

Swiss Formula three nations (Argentina-Brazil-India)

recommended a multiple co-efficientS

wiss Formulabased on each countrys tariff average.

Services.

Policy space for developing countries preserved.


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AGREEMENTSAGREEMENTS


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AGREEMENTSAGREEMENTS ANTIANTI--DUMPINGDUMPING

Exports a product at a price

lower than the price it normally

charges in its own home

market

Keeps check against such

dumped imports if causing

injury to a domestic industry.

Criteria

Dumping of goods has

taken place.

There was an injury to the

domestic industry, and

There exists an causal link

between dumping and

injury.

SAFEGUARDSSAFEGUARDS

Allows to take a safeguard

action to protect a specificdomestic industry from anunforeseen increase of imports

Members must not seek, take ormaintain any voluntary exportrestraints, orderly marketingarrangements

An import surge should justifysafeguard action

SUBSIDIES AND COUNTERVAILINGSUBSIDIES AND COUNTERVAILINGMEASURESMEASURES

Disciplines the use of subsidies,

and it regulates the actions

countries can take to counter theeffects of subsidies.

Applies to agricultural goods as

well as industrial products.

Two categories of subsidies:

prohibited and actionable.


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AGREEMENTSAGREEMENTS TRADE RELATED INVESTMENTTRADE RELATED INVESTMENT

MEASURES (TRIMS)MEASURES (TRIMS)

Promotion of progressiveliberalization of world trade

Facilitation of investment acrossinternational frontiers.

Applies only to trade in goods

Restrict preference of domesticfirms

Elimination two years fordeveloped countries, five yearsfor developing countries andseven years for LDCs.

TECHNICAL BARRIERS TO TRADETECHNICAL BARRIERS TO TRADE

Recognizes rights to adopt thestandards nations consider appropriate. eg, for human, animalor plant life or health, for theprotection of the environment orto meet other consumer interests.

Encourages countries to useinternational standards .

.

AGREEMENT ON PRESHIPMENTAGREEMENT ON PRESHIPMENTINSPECTIONINSPECTION

Recourse to preshipment inspection

Verify the quality, quantity or price

of imported goods

Provide transparency of the

operation

RULESOF ORIGINRULESOF ORIGIN

Their application facilitate the flow

of international trade.

Clear and predictable rules

Rules of origin do not nullify or

impair the rights of members under

GATT 1994.

TRADE IN SERVICESTRADE IN SERVICES

Establish a multilateral framework ofprinciples and rules for trade inservices

Right of members to regulateintroduce new regulations withintheir territories in order to meet

national policy objectives.


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OTHER AGREEMENTSOTHER AGREEMENTS

AGRICULTUREAGRICULTURE

SANITARY AND PHYSOSANITARY MEASURESSANITARY AND PHYSOSANITARY MEASURES

TEXTILES AND CLOTHINGTEXTILES AND CLOTHING

CU

ST

OMSV

ALUATIO

NSC

US

TOMS

V

ALUATIO

NS

IMPORT LICENSING PROCEDURESIMPORT LICENSING PROCEDURES

INFORMATION TECHNOLOGYINFORMATION TECHNOLOGY

BASIC TELECOMMUNICATIONSBASIC TELECOMMUNICATIONS

FINANCIAL SERVICESFINANCIAL SERVICES

MOVEMENT OF NATURAL PERSONSMOVEMENT OF NATURAL PERSONS

MARITIME TRANSPORTMARITIME TRANSPORT


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DECISION MAKING IN WTODECISION MAKING IN WTO


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PRINCIPLESOF THE TRADING SYSTEMPRINCIPLESOF THE TRADING SYSTEMFOLLOWSFOLLOWS THESETHESE FUNDAMENTALFUNDAMENTAL PRINCIPLESPRINCIPLES OFOF TRADINGTRADING..

TRADINGTRADING SYSTEMSYSTEM SHOULDSHOULD BEBE FREEFREE OFOF DISCRIMINATIONDISCRIMINATION..

TRADINGTRADING SYSTEMSYSTEM SHOULDSHOULD TENDTEND TOWARDTOWARD MOREMORE FREEDOMFREEDOM..

TRADINGTRADING SYSTEMSYSTEM SHOULDSHOULD BEBE PREDICTABLEPREDICTABLE..

TRADINGTRADING SYSTEMSYSTEM SHOULDSHOULD TENDTEND TOWARDTOWARD GREATERGREATER

COMPETITIONCOMPETITION..

TRADINGTRADING SYSTEMSYSTEM SHOULDSHOULD BEBE MOREMORE ACCOMMODATINGACCOMMODATING FORFOR

LESSLESS DEVELOPEDDEVELOPED COUNTRIESCOUNTRIES..


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REALITYREALITY Lack of internal transparency

Lack of participation of developing countries in

decision-making processes.

A country wishing to oppose a harmful proposal

can be effective only if it puts up a formalopposition at the time a decision by consensus is

sought.

Has to muster the support of the majority of the

members present. Thus, even today about half to two-thirds of any

full Green Room process would be comprised of

developing country participants


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PROBLEMSPROBLEMS

The practice of the consensus system isoften unfair to developing countries.

The overloaded agenda and too manymeetings held simultaneously have put

resource-deficient developing countries at agreat disadvantage.

Economic and political pressures areapplied on developing countries to influencetheir negotiating position.

There is great difficulty or impossibility tochange existing rules, even if they are

imbalanced or damaging.


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PROPOSALS TO IMPROVE DECISION MAKINGPROPOSALS TO IMPROVE DECISION MAKING

Permanent management or steering group needs to beestablished .

A small, informal steering committee (20 or so in number)to be set that can be delegated responsibility for developing consensus on trade issues among the membercountries.

Would not undercut existing WTO rights and obligationsnor the rule of decision making by consensus;

The formation of groups of countries would serve twoimportant functions.

significantly increase the number of WTO members

represented in the Green Room process. provide a forum for information sharing and

consultation among group members, and a channel forthe provision of technical assistance on WTO matters.Small countries in particular would benefit from such

pooling of resources.


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GENERAL PROPOSALSGENERAL PROPOSALS

Consensus system should be applied in a manner that fully

respects the views of developing-country members. The views of every member must be respected in a

decision involving consensus and explicit consensus,especially in the case of important issues.

WTO should adopt a realistic agenda and work schedulethat is fair especially for smaller delegations.

Developing countries should not be subjected to economicand political pressure relating to negotiations.

Decisions should not be made until all members are

technically ready. Developed countries should be ready to resolve

development issues (including implementation and specialand differential treatment) without exacting a new price.


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IMPLICATIONSIMPLICATIONS


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TheThe worldworld facesfaces thethe prospectprospect ofof 400400

preferentialpreferential tradetrade agreementsagreements byby 20102010 andand

thethe challengechallenge ofof ensuringensuring theythey contributecontributetoto thethe healthhealth ofof worldworld tradetrade

DirectorDirector--GeneralP

ascal LamyGeneralP

ascal Lamy(CII in Bangalore : 17 Jan 2007)(CII in Bangalore : 17 Jan 2007)

IMPLICATIONS


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WT

O Concerns all the

Countries.

Every Economic activity will be influenced by

agreements emanating from Negotiations in WTO.

Market access will improve with lowering of tariffs

and dismantling of other import restrictions. Lower tariffs will mean higher access to domestic

markets for foreign companies.

Broadened International scope ofBusiness.

Increased Products life. Easier and less expensive access to foreign

market.

Improved access ofConsumers to Product.

High Quality at Low Price. High Value forMoney.

IMPLICATIONS


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Consumer is the King Improved Business Efficiency (Inputs optimized).

Exploitation of Economies of Scale

(Encouraging product wise SEZ concept).

Increased importance of Marketing Research togain and retain market.

More importance to Environment Standards,

Health and Safety issues.

More FDI due to liberalized Foreign investmentregime.

Multilateral Globalized Forums help in coping with

trade accidents.

Brings order to International Trade

IMPLICATIONS


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Present Scenario : -ve Implications

Since inception in 1995, a Major Focus for

Protests by Civil Society Groups in many countries.

WTO rules evolved in Developed Countries

reflect their concerns / ideologies.

Free Trade not making Ordinary People's Lives

more Prosperous But Rich becoming Richer.

WTO Treaties: Unfair Bias towards MNC and

Wealth Countries

IMPLICATIONS


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Under Devp / Developing Countries wield littleInfluence - Influential Nations Focus own

Commercial Interests.

Developing Countries forced to sign on Dotted

lines. Issues of Health, Safety and Environment are

ignored.

Developing countries have given more than what

they have received. India has changed its IPRs, QRs and Textile

Policies But No Benefits Visible.

Rich Countries Maintain High Import Duties and

Quotas, blocking imports from devp countries.

IMPLICATIONS


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Anti-Dumping Measures against developingcountries.

High protection to agriculture in developed

countries : Developing ones pressuried to opentheir markets.

The TRIPS agreement limits developing countries

from utilizing technology originating from abroad.

Many developing countries do not have the

capacity to participate actively and follow the

negotiations.

IMPLICATIONS


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Present Scenario : +ve Implications

Developing Countries Reviewed antiqueted

trade policies like QRs : to meet realities of

market.

USA forced to abodan its Super 301 provision.

Developing Countries using multilateral forum tonegtiate beter deals for themselves.

IMPLICATIONS


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India - FounderMemberOf GATT

Relevance To India Access To World Market

Boost To Export Industry

More Competative

Multi Trading System

Rising Import/export

Agriculture most critical

Validation of GIs-GeographicalIndications

Issues India needs to decide Tariff cuts

Custom procedures

Consensus

INDIAN CONTEXT


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INDIASCONTRIBUTION IN WTO

Liberising Tariffs & MarketAccess

Active Role In G-20/G-33

Equal Role In Services

Key Role In TRIPS AGREEMENT

Has Challenged EU & US At

Dispute Settlement Body

India Opposed The Declaration

At Cancun Meet 2003.

WTO DG Recognizes Indias

Ambitions


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