1. The WTO - The World Trade Organization

2. What is the WTO? Definition Organization to supervise and liberalize international trade -> forum for governments to negotiate trade agreements -> place for governments to settle trade disputes -> WTO operates a system of trade rules

3. What is the WTO? International organization Headquarters: Geneva, Switzerland Membership: 153 Members Staff: 625 Official languages: English, French, Spanish Director-General: Pascal Lamy Governed by Ministerial Conference (meets every two years) General Council; implements conference‘s policy decisions, responisble for day-to-day administration

4. History of the WTO Since 1948: The General Agreement of Tariffs and Trade (GATT) -> led to birth of unofficial international organization: GATT Last and largest GATT round: Uruguay Round (1986 – 1994) -> led to creation of WTO Came into being: 1.January 1995

5. 3 Main WTO Agreements Cover all three main areas of trade handled by the WTO 1. General Agreement on Tariffs and Trade (GATT) 2. General Agreement on Trade in Services (GATS) 3. Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)

6. Principles of WTO trading system Most-favoured nation (MFN): countries cannot normally discriminate between trading partners National treatment: countries should not discriminate between its own and foreign products or services

7. Principles of WTO trading system Freer – Barriers coming down through negotiation Predictable – foreign companies, investors and governments should be confident that trade barriers should not be raised arbitrarily

8. Principles of WTO trading system More competitive – discouraging „unfair“ pratices f.ex.: export subsidies More beneficial for less developed countries – give them more time to adjust, greater flexibility, and special privileges

9. Advantages of WTO Helps promote peace between nations Disputes are handled constructively Rules make it easier for all – WTO based on rules not on power Free trade cuts the cost of living, provides more choice of products and quality Trade stimulates economic growth Trade raises income of country and it‘s people Basic principles make life more efficent Governments shielded from lobbying System encourages good governance

10. Criticism of the WTO..is fundamentally undemocratic..tramples labor and human rights..would privatize essential services..is destroying the environment..is endangering human lives..is increasing inequality..hurts poor countries in favor of rich powerful nations..undermines local level decision-making and national sovereignty

11. Case Study The Banana Case (1997) EU preferred treatment for bananas produced by former colonies in the Caribbean. The United States, which does not produce any bananas, brought this case against the EU on behalf of the U.S.-based Chiquita corporation. Chiquita produces bananas in Latin America on huge plantations that are notorious for exploiting cheap farm labor and using environmentally damaging techniques. In the Caribbean, which Europe is favoring, banana producers tend to be small-scale farmers who own and work their own land (an average of three acres). Should WTO consider social and environmental issues when making its trade rules?