4.4.6 The World Trade Organization (WTO) Notes

Objectives and Functions

The World Trade Organisation (WTO) has the following objectives and functions:

1. It is in charge of administrating WTO agreements.
   1. The organisation assists in the implementation and oversight of international trade agreements.
2. Provides a forum for negotiating trades.
   1. One of the most important functions of the WTO as it provides a platform for member countries to discuss trade problems and negotiate agreements.
3. Resolves trade disputes.
   1. When members dispute on issues, the final decision goes to the WTO to resolve the disagreement.
4. Monitors national trade policies.
   1. WTO performs periodic reviews of member countries' trade policies and members are to notify WTO of any changes in their trade policies.
5. Offers developing countries technical training and assistance.
   1. WTO offers training of government officials, academia, private sector representatives, etc, in developing countries on trade issues and WTO agreements.
6. In control of cooperation with other international organisations.
   1. Works with World Bank and International Monetary Fund, to coordinate in creating global policies.

Factors affecting the influence of the WTO

Difficulties of reaching agreement on services/primary products

1. Over time, negotiations became heavily swayed to interests of developed countries.
2. With respect to commodities, farmers in developed countries have been protected for a long duration through their government's production and export subsidies.
3. This made them highly competitive in the global market, which significantly affects developing countries and their farmers as they do not have the same level of capital to invest into the sector.

Unequal bargaining power of members

1. Even though the rules are designed to be such that decision-makings are done democratically, decisions are made as a consensus.
2. To elaborate, decisions in the WTO are made depending on the power of members rather than the democratic rule as countries with high influence are in control of agendas and often carry great weight in their arguments.
3. Meanwhile, oftentimes the less influential countries, remain silent and succumb to the actions of the influential countries as they fear of possible retaliation against them.
4. Further problems are the creation of country coalitions and process of negotiations, where the decision-makers or leaders in these efforts are oftentimes economies with high levels of influence.