What Is WTO ,and How Did It Come About?- Some Background Information

Basically, The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by most of the world’s trading nations and ratified in their parliaments. This majorly aims at helping producers of goods and services, exporters, and importers conduct their business.

The majority of the WTO’s current work comes from the 1986–94 negotiations popularly known as that Uruguay Round which was a furtherance of earlier negotiations under the General Agreement on Tariffs and Trade (GATT).

The structure WTO has in place are meant to discharge its functions which are administering WTO trade agreements, being a forum for trade negotiations, handling trade disputes, monitoring national trade policies, offering technical assistance and training for developing countries and encouraging Cooperation with other international organizations.

Under, WTO there are many organs performing different functions with the key decision making organ being the Ministerial Conference. Then there is the  General Council– WTO’s highest-level decision-making body in Geneva, meeting regularly to carry out the functions of the WTO. Under it  which there are the committees on different areas and also the council on trade in goods, the council for tread related aspects of intellectual property rights and council on trade in services. It is noteworthy that the council can usually sit  under different rules, as a Dispute Settlement Body and as a Trade Policy Review Body.

The Ministerial Conference

The Ministerial Conference is the topmost decision-making body of the WTO. It usually meets every two years. It brings together all members of the WTO, all of which are countries or customs unions. The Ministerial Conference can take decisions on all matters under any of the multilateral trade agreements.

So where does the Ministerial conference draw its mandate?

The Agreement that established the WTO is popularly referred to as the Marrakesh Agreement. It established the Ministerial conference in Article IV which states that  there shall be a Ministerial Conference composed of representatives of all the Members, which shall meet at least once every two years. The Ministerial Conference shall carry out the functions of the WTO and take actions necessary to this effect.

The article[IV] further indicates that the  Ministerial Conference shall have the authority to take decisions on all matters under any of the Multilateral Trade Agreements, if so requested by a Member, in accordance with the specific requirements for decision-making in this Agreement and in the relevant Multilateral Trade Agreement.

What did  The MC12  Achieve- The Highlights

The just concluded  WTO’s 12th Ministerial Conference (MC12) took place from 12 to 17 June 2022 atWTO headquarters in Geneva and was co-hosted with co-hosted by Kazakhstan. The Co-hosting was due to the fact that Kazakhstan was originally scheduled to host MC12 in June 2020 -a   conference that was postponed due to the COVID-19 pandemic. As expected, Covi9-19 the pandemic took centre stage especially around issues of supply chain , vaccines availability and TRIPS flexibilities.

At the MC12, members  concluded a multilaterally negotiated outcomes on a series of key trade initiatives in what is now referred to as “ the Geneva Package”. The Geneva Package contain several outcomes.

First, is the  Outcome Document through which members  made a commitment to strengthen the rules-based, non-discriminatory, open, fair, inclusive, equitable and transparent multilateral trading system with the WTO at its core, reaffirmed  the WTO decision at the Tenth Ministerial Conference (MC10) on implementation of preferential treatment in favour of services and service suppliers of least-developed countries and increasing LDC participation in services trade, and instruct the Council for Trade in Services to review and promote the operationalization of the waiver including to explore improvements in LDC services export data; and reaffirming the importance of providing relevant support to developing country Members, especially LDCs, to achieve sustainable development, including through technological innovations.

Second, WTO members addressed themselves to response to emergencies  and this entailed a Ministerial Declaration on the Emergency Response to Food Insecurity, a Ministerial Decision on World Food Programme (WFP) Food Purchases Exemptions from Export Prohibitions or Restrictions, a Ministerial Declaration on the WTO Response to the COVID-19 Pandemic and Preparedness for Future Pandemics, and a Ministerial Decision on the Agreement on Trade-related Aspects of Intellectual Property Rights.

Third, there was a  decision on E-commerce Moratorium and Work Programme. On 20 May 1998 at the Second Ministerial Conference, WTO members adopted  a declaration on global electronic commerce– and which also  included a moratorium stating that “members will continue their current practice of not imposing customs duties on electronic transmission. Further, this  Declaration directed the WTO General Council to establish a comprehensive work programme to examine all trade-related issues arising from electronic commerce. This moratorium has been extended by the Members severally, and through  the current decision WTO Members  agreed to maintain the current practice of not imposing customs duties on electronic transmissions until MC13- which should ordinarily be held by 31 December 2023.  However should MC13 be delayed beyond 31 March 2024,  then the moratorium will expire on that date unless Ministers or the General Council take a decision to extend.

Fourth, there was an agreement on Fisheries Subsidies which dealt with amendments. In addition to the above, the  WTO meeting also adopted two decisions, on  the Work Programme on Small Economies  and on the TRIPS non-violation and situation complaints; and a Sanitary and Phytosanitary Declaration for the Twelfth WTO Ministerial Conference: Responding to Modern SPS Challenges.

What do all these mean for the developing countries such as those in Africa, and the Caribbean? The next blog will  give an overview of these highlighted  decisions of the MC12 while spotlighting  of how they could impact trade and development in the ACP.

Image credit: wto.org

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