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ROLE AND FUNCTION OF WORLD TRADE ORGANISATION (WTO)




ROLE AND FUNCTION OF WORLD TRADE ORGANISATION (WTO)
                                                                   

Meaning: -The World Trade Organisation came into existence with effect from 1-1-1995. The WTO replaced General Agreement on Tariffs and Trade (GATT). The main objective of WTO is to increase world trade and thereby employment. In 1947, 23 countries including India signed the General Agreement on Tariffs and Trade (GATT). GATT was created to reduce the tariff barriers. GATT has been replaced by WTO in 1995. WTO is wider in scope. It is concerned with not only reducing or eliminating tariff barriers but also non-tariff barriers such as quotas. In April 2004, the membership of WTO was 147 countries including India.


  1. Administration of Agreements: -It looks after the administration of the 29 agreements (signed at the conclusion of Uruguay Round in 1994), plus a number of other agreements, entered into after the Uruguay Round.



  1. Implementation of Reduction of Trade Barriers: -It checks the implementation of tariff cuts and reduction of non-tariff measures agreed upon by the member nation at the conclusion of the Uruguay Round.


  1. Examination of Member’s Trade Policies: -It regularly examines the foreign trade policies of the member nations, to see that such policies are in line with WTO’s guidelines.


  1. Collection of Foreign Trade Information: -It collects information in respect of Export-Import trade, various trade measures and other trade statistics of member nations.


  1. Settlement of Disputes: -It provides conciliation mechanism for arriving at an amicable solution to trade conflicts among member nations.



  1. Consultancy Services: -It keeps a watch on the development in the World economy and it provides consultancy services to its member nations.



  1. Forum for Negotiation: -WTO is a forum where member nations continuously negotiate the exchange of trade concessions. The member nations also discus trade restrictions in areas of goods, services, intellectual property, etc.


  1. Assistance of IMF and IBRD: -It assists IMF and IBRD for establishing coherence in universal economic policy administration.

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