Introduction
World trade organization can be analyzed from two perspectives. First of all, it is considered as a way of negotiating the trade dispute or as a way of opening trade. Governments, the participants of the world trade organization, use this avenue to settle trading disputes between member countries using the rules that were established among them and signed to all of them.
The organization was established after negotiations had been held and agreement had been signed. Thus, all actions taken by an organization are guided by the rules provided in the agreement and negotiations among the major countries.
Its current operations are largely guided by the agreements of the 1986-1984 in Uruguay and the other rules that guided General Agreement on Tariff and Trade (GATT) which the WTO replaced. WTO is the product of the new agreements inaugurated in the year 2001 through the “Doha Development Agenda”.
The WTO negotiations helped countries that faced trade barriers to operate in open market environments. At times, the rules also support trade barriers to block out non member countries, as well as protect consumers. This helps control the spread of unethical rules and procedures.
The success of the organization is a result of the agreement signed by over 27 countries trading together. The organization ensures free trade among the operating countries through regulation of the international trade and it has succeeded in meeting its objectives as it will be described in this paper (Haerens 2010).
Before WTO was introduced, GATT had been operating between 1947 and 1986, the period within which it made several achievements. Its last achievement in 1974 was a successful agreement regarding international trade in textiles, it rebranded the Multifibre Arrangement (MFA) and it came into operation. It was formed to control the growth of exports in textile and clothing strictly at 6% per year.
Several negotiations took place in 1977 and 1982 with an extension in 1986 and 1991 and lastly in 1992 which led to the sister organization the WTO. In 1986, World Trade Organization was brought into inception during the Uruguay Launch in the city of Punta del Este. The final law which established the WTO was signed by the member countries in April 1994 to round up the outcomes of the Uruguay round.
On January 1st , it entered into full operation, after successfully operating for 4 years a new round was signed in Seattle but failed in the ministerial meeting. As a result, a new round of talks was scheduled for Doha, Qatar branded the Doha Development Agenda.
Each of the results of the meetings resulted into rules and procedures geared to support international trade. It was agreed and signed that there was a minimum which each country could inject into the world trade. Developing countries are set for quotas given their 2/3 share in the quota. The contracts signed bind member countries to adhere and keep the policies agreed upon and follow them to the limits prescribed.
The main objective to be achieved by the rule regulations and contracts is creation of an enabling environment for countries producing both, goods and services, as well as importers and exporters so that they are able to do business successfully. The rules also guide on ethical practices which are geared towards helping the said countries to meet their environmentally, as well as socially acceptable aims and goals (Haerens 2010).
Roles of WTO and their success
the WTO has enormously succeeded in bulk of the roles accorded to it. The organization has since developed a framework and structures to support its work through formed treaties. WTO has combining roles and responsibilities one of which is to be an overseer of a signed treaty that is over thirty thousand pages.
The other treaties that it is to look at and safeguard, is that involving agreement with regards to safety of goods and services to both the producer and consumer countries respectively.
The strength and effectiveness of the WTO was seen at the start but has since recorded a decline in strength and how viable it is especially after the failure of the ministerial conference which happened in Seattle. Trade dispute settlement is a key identity of the WTO through it is a well established dispute settlement procedures.
The organization officers have great pride in the manner in which they are always up to the task of settling any dispute that entangles their members, through this the WTO had a very big impact on the world trade systems and alongside the diplomacy between countries resulting into trade propelled.
The treaties efficacy is dully supported by international laws hence efficiency. The treaties are also highly supported since they support free trade flow and free trade flow is responsible for massive economic development and growth mostly realized with developing countries (Macrory, Appleton, Plummer 2005).
Reasons for success of WTO
The reasons that have ensured that success is achieved are by ensuring that individuals, firm and organizations and member countries are aware of the trade rules and regulations. The stakeholders must also be assured of the stability and how long lasting the laws is likely to be so that their confidence is worn.
The rules must advocate for transparency and accountability not forgetting that they should be predictable so that they enhance the planning of the member countries (Macrory, Appleton, Plummer 2005).
The underlying base of the dispute settlement process of the WTO is the normal agreement on the basis of a strong legal framework which ensures that conflicting interests are always laid to rest and the interpretation of agreements, whenever there is some form of misunderstanding among the member countries.
Through its strong dispute settling framework, WTO has been a success in solving trade disputes since its inception; this has acted as its strong pillar. Members have witnessed and agreed that this dispute settling pillar has been beneficial to most of the members if not all, since it has facilitated members in solving their trade wrangles at fast speed in a fair and just manner and at a highly predictable way.
The achievement of the organization in achieving settlements of international disputes due to its automatic nature of action has enhanced world security, peace, stability and certainty of its international trade regulations.
While it is true that there is never success without challenges, it is of no doubt that the ads override the disadvantages in the procedure of conducting and resolving international trade disputes, the appellate body has also contributed significantly to ensuring that members get clarification on vague issues as indicated by the contract documents (Qureshi 2006).
Developed vs. developing countries
It is true that policies of the WTO are shaped majorly by the developed countries due to the vast challenges that the developing countries face. The ever growing problem that is that of economic disparity between the developed and developing countries. WTO deals with facilitation for condition of trade and investment.
The challenge that is faced by the WTO is how to integrate the developing country given their specific concerns about the organization. The developing countries cannot be neglected given that their quota in the organization is allocated 2/3 of the membership classification.
This is despite the fact that they actively attend the meetings and listen to the speakers, while they do not comment on anything. In this manner, they constitute a part of the decisions arrived, without contributing anything to the resolutions.
This may be favorable or unfavorable. The silence may be because they may not be feeling that the decisions arrived affect them directly, they may as well not understand the content of discussion hence fear being irrelevant.
They may also be afraid of providing opposing decisions since opposing a major developed country may act as a slap on their face, politically or economically. The strategy may also be relevant in the case where a country does not participate thinking that another stronger country will speak for them.
Far from the mentioned above, the slow development of trade of developing countries, as compared to those of developed is a major issue with the WTO. This is because their power is political due to their voting power in the block is of immense importance to economic development.
Trade liberalization that is majorly influenced by the developing nations through their votiong facilitates the development of the promotion of increased trade and investment (Macrory, Appleton, Plummer 2005).
The General Agreement for Trade in Services (GATS) as a binding contract is used to enhance and support business of services which are never well developed in developing countries. This agreement is to enable developing countries to have the capability of exporting services and also form partnerships with the foreign service firms so that they are able to share in their technology.
When it comes to dispute resolution, developed countries are the major participants led by the US and the EU, but recently the developing countries have been witnessed to participate in equal measure. It has been evidenced that developing countries have shown success in dispute resolution systems not only developed country members but to extremely larger trading nations (WTO analytical index 2003).
The Cancun Agreement
The agreement was established prominently to help in addressing long term environmental set backs, especially climatic change. The policies are set to help in cutting down the emission of green house gases. Its fundamental objective was to help save developing nations from vast effects of the gases.
The agreements were to help reduce production of green house gases through enhanced participation of all countries. It advocated for transparency and timeliness in the way the actions were taken among many other agreements (Krolll 2007).
Conclusion
The agreement have lead to a success in the forms that it has ensured that the world countries are able to come together to agree in a way to reduce green house effect, it has come at a time when the developing countries needed help to deal with climate change, hence the agreement provided it with the relevant package for the same. It has also resulted into the pieces of agreement being done within the required schedule.
The world trade organization has since played a fundamental role in shaping how countries relate depending on whether they are developed, developing or less developed. This body has facilitated the spread of resources in almost an equal measure to create a balance. The formulated ideas are thus very essential for the development of the world orders.
References
Haerens, M. (2010). The World Trade Organization. Detroit: Greenhaven Press/gale, Cengage Learning.
Krolll, D. (2007). Toward multilateral competition law?: after Cancun: reevaluating the case for additional international competition rules under special consideration of the WTO agreement. Frankfurt am Main: Peter Lang.
Macrory, P. F., Appleton, A. E., & Plummer, M. G. (2005). The World Trade Organization legal, economic and political analysis. New York: Springer.
Qureshi, A. H. (2006). Interpreting WTO agreements: problems and perspectives. Cambridge, UK: Cambridge University Press.
WTO analytical index: guide to WTO law and practice. (2003). Geneva: WTO Publications.