- Key objective
- Benefits and Drawbacks of WTO
- How the WTO is planned?
- How WTO impacts the world trade?
- Banking and financial services
WTO established in the year 1995, it is an international institution that manages the rules and regulations of global trade between the nations. It out-dated GATT (general agreement on tariffs and trade) 1947 produced in the stir of World War 2. The WTO is focused on agreements negotiated by the majority of population trading nations. The key role of the organisations that helps producers of products , services, exporters and importers secure and handle their companies. As of now 2021, the WTO includes hundred and sixty four members countries along Liberia and Afghanistan that has been joined in July 2016 and contains twenty three viewer nations.
- The main objective of the WTO is to offer open source of communication with respect to trade between its members.
- The WTO supervises global trade rules between the nations.
- It covers the globalization with positive and negative effects.
Benefits and Drawbacks of WTO
- The WTO has accelerated with plus and minus consequences and the past of international investment has been struggle between protectionist policies and free markets.
- The activities have a led to increased foreign trade growth but at the expense of local economies and human dignity.
- Opponents of the WTO, especially multinational corporations argue that the organisational benefits business by promoting trade agreements and reducing trade conflicts all of which are advantageous to the global economy.
- Observations imply that the WTO violates democracy ideals and broadens the global income inequality.
How the WTO is planned?
The WTO has 164 members that account for 98% of global trade. A total of 25 countries are in the process of applying for membership. The total leadership makes decisions. This is usually done by consensus. A majority of votes is also an option, but it hasn’t been used in the WTO and was highly uncommon underneath the GATT, the WTO’s predecessor.
Both members’ parliaments have accepted the WTO’s agreements. The Ministerial conference is the highest decision making structure which occurs every two years. The general council also serves as the dispute session and the trade policy review body. It receives reports from the goods, service and intellectual property council.
Numerous specialised committees , professional organizations and working parties refer to specific agreements as well as other topics like the climate, membership applications , progress and trade agreements.
The main goal is to make trade operate properly, freely and reliably. It accomplishes this through:
- Serving as a platform for trade deals
- Implementing trade agreements
- Updating regional economic policies
- Resolving trade conflicts
- Coordinating with other international institutions
- Enhancing developing economies trade capability
How WTO impacts the world trade?
The framework of WTO breaks away other obstacles among people and trading economies through reducing trade barriers across negotiations between member governments. These serves as the legal basis for international commerce. In essence they are contracts that include important trade agreements to WTO members.
It is basically an external dispute settlement or meditation body that embraces international trade laws. The organisation offers a forum for government departments to discuss and address trade disputes with one another. The main goal is to keep communication open among its members when it comes to trade.
For instance, WTO has reduced trade restrictions and increased trade between member countries. In another hand, whenever it makes any sense in the globalized world, it has preserved barriers to trade. As a result, the WTO tries to medicate negotiations in favour of the world economy.
Following the conclusion of the negotiation and the signing of an agreement, the WTO offers to define the agreement in the case of potential conflict. All WTO agreements involve an approval process in which the company legally resolves disputes in a stable manner.
Banking and financial services
In modern economic terms, the financial service industry is extremely important. The financial system of an economy consists of institutions that perform important components such as mobilizing savings, making agreements (the goods and service exchange), tracking company and managers (to ensure that funds allocated are spent as planned), assigning capital funds (particularly to facilitate productive investments) and risk reduction (by aggregating risk, it can be borne through those who are more prepared to take it on).Launching the financial sector to international investment and competition not only broadens the range of banking products available to local customers both individuals and business but it also has the potential to reduce costs and increase the efficiency of these essential functions.
Both banking and other financial institutions includes the recognition of deposit accounts and other paid back assets, all transaction and money transfer services (e.g. debit and credit charge, bankers drafts and travellers’ cheque), all forms of borrowing (eg. consumer credit, loan credit and business transaction financing), stock trading, reinsurance, guarantees and obligation, money broking, settlement services, lending , service and exchange of banking data, asset ,management, and other supplementary institutions.
Finally, the WTO organisation was well defined and their impacts, structure had been figure out. Then the organisational and banking sector needs also been demonstrated.