Published on March 7, 2014
The prolonged recession before the world war 2nd & the devastation caused by the world war 2nd led to the BRETTON WOODS conference resulting in the formation IMF , IBRD & ITO. The IMF, IBRD and ITO, were formed in 1945 but USA didn’t ratify ITO. 23 countries met in Geneva in 1947 & signed a agreement on tariff & international trade.(GATT)
Set of multilateral trade agreements aimed at the abolition of quotas and the reduction of tariffs among member countries. Signed on October 30, 1947, by 23 countries in Geneva (to take effect on January 1, 1948) It Consists of 8 Rounds – Rounds of trade negotiations
Non discrimination Prohibition of quantitative restrictions Consultations. To raise the standard of living. 2. To ensure full employment and a large and steadily growing volume of real income and effective demand. 3. To develop the full use of the resource of the world 4. To expand production and international trade. 1.
Country Year Countries Reduction In Tariffs In Billions Geneva(Swiss) 1947 23 45000 $10 billion of trade which was 20% of global trade Annecy France 1949 13 5000 tariff ----- Torquay UK 1950 38 8700 tariff concession Cutting the tariffs levels by 25 % of 1945 level Geneva II Swiss 1955-56 26 Tariff reductions 2.5 billion dollars worth Geneva Swiss 1960-61 26 Tariff reductions Worth 4.9 billion dollars Geneva Swiss 1964 62 Concessions were made $40 billion worth --- Tokyo 1973-79 102 $300 billion reduction Non tariff reductions Uruguay 1986-94 125 WTO was formed…
Strength increased from 23 to 125 countries. 50 years has witnessed an exception growth in world trade. Merchandise export grew on an average of 6% annually. Total trade in 2002 was 22 times than that of 1950. Principal achievements of GATT were the establishment of a forum for continuing consultation . Disputes that could have resulted in hard feeling are compromised. Developing countries with balance of payment problems were generally exempted from liberalization. The average level of tariff on manufactured products in industrial countries was brought down from about 40% in 1947 to nearly 3% after Uruguay round. The first 6 rounds concentrated on reducing tariffs while the 7th round of Tokyo moved on to tackle non tariff barriers. The 8th round helped in establishing the WTO a global organization to regulate trade between nations. Today 97 % of the world trade is routed through GATT & WTO
The world trade organization was established on 1st January 1995. It is the embodiment of the Uruguay round results & the successor to GATT. WTO has 153 members, India being one of the founder members. The head of WTO is located in Geneva of Switzerland. “Child becomes a Parent & Parent a child” As per 2nd March 2013, there are 159 Members of WTO.
“WTO is an International body designed to play the role of a watchdog in spheres of trade in Goods, services foreign investments, IPR etc.” WTO is the only international organization dealing with the global rules of trade between nations. Its main function is to ensure that trade flows as smoothly, predictably and freely as possible.
Administering WTO trade agreements Forum for trade negotiations Handling trade disputes It acts as a watch dog of international trade Monitoring national trade policies Technical assistance and training for developing countries Cooperation with other international organizations Providing technical assistance and training for developing countries.
GATT GATS TRIP’S TRIM’S Disputes settlement mechanism Antidumping measures Agreement on agriculture
It is a General Agreement on Trade in Services. It covers 4 modes of international delivery of services: Cross border flow (Trans border data flows, transportation services) Commercial presence (Provision of services abroad thru FDI , etc..) Consumption abroad Movement of personnel (Entry & temporary stay of foreign consultants)
Trade Related Aspects of Intellectual Property Rights IPR are the rights given to persons over the creation of their minds. These exclusive rights are given for usage for certain time period. OBJECTIVES To encourage & reward creative work . Technological innovations . Fair competition. Consumer protection. Transfer of technology.
It covers rights for : 1. Copy rights & related rights 2. Trademarks 3. Geographical indications 4. Industrial design 5. Layout design 6. Patents 7. Undisclosed information (trade secrets etc..)
It is Trade Related Investment Measures No country shall apply TRIMS which is inconsistent with WTO articles . the following are inconsistent :Local content requirement Trade balancing requirement Trade & foreign exchange Domestic sales requirement.
It has a fixed dead line in settlement of disputes . The first ruling does not extend beyond 1 year. The appeal is generally disposed off before 60 days.
Meaning- It means selling the product at below the on going market price or at the price below the cost of production. Anti-Dumping laws is applicable if the margin of dumping is more than 2% of the export price or the volume of dumped products is more than 3% of the product. Anti-Dumping duty shall not exceed the margin of dumping . Anti-Dumping action may be suspended or terminated if the exporter agrees to remove the dumping or the injurious effect of it.
Agreement on Agriculture There are 3 principal commitments.. 1. Market Access :- no import restrictions & limitations 2. Domestic support :- Elimination of govt support to domestic company’s. 3. Export subsidies :- phase out support given to exporters .. Other important aspects are:a) Tariffication :- means removal of tariff quotas. b) Tariff binding :- means fixing the max rate of import duty, above which a country does not raise the duty unilaterally.
I. II. III. IV. V. GATT is an agreement. It was designed with an attempt to establish International Trade Organizations It was applied on a provisional bases GATT covered only goods. Disputes settlement mechanism slow & at times in conclusive. I. II. III. IV. V. WTO is an organization. It is establishes to serve its own purpose. Its activity are full and permanent. It covers goods, services, IPR. Dispute settlement system is fast
IMF – International Monetary Fund IBRD – International Bank of Reconstruction and Development ITO – International Trade Organization IPR – Intellectual Property Rights
www.wto.org www.wikipedia.org International Business- 2e- P Subba Rao.
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