INSTITUTE FOR INTERNATIONAL MANAGEMENT AND TECHNOLOGY GURGAON

SubjectINTERNATIONAL BUSINESS

Topic WORLD TRADE ORGANIZATION

SUBMITTED TO SUBMITTED BYDR. DURGA MOHAN SNEHAL AGRAWAL

INTRODUCTION

WTO Is the only organization which deals with the rules of the trade in the different nation or dealing globally. The function of WTO is to ensure the trade flow smoothly and trading between the nation is freely. It is of free of cost. The world trade organization came out of from General Agreement on Tariffs and Trade (GATT). Wto was established in the year 1947 fter the II world war. The aime for which this organization is made or build is to reduce the tariffs rate on the international trade on global market. The main reason for the general agreement on tariffs and trade was based on the most favored nation clauses which allows by the one country to the other country. At that time the main focuses of GATT is on the helping all that countries having msn. MSN includes like status so that not even single country having trading advantages over other country. The WTO is bourn from the negotiation all the activity performed by the organization is the result of negotiation. Anyone can see wto as a different ways it is a organization which provide liberal trade between the member county, It a centre for the government to negotiate the agreement between the different countries, it’s a place for the settlement of disputes of trade between the different countries . The main work of wto is came from 1985 – 1994negosiation which is called URGENCY ROUND and the previous round is of negotiation is GATT. In the year 2001 WTO is a host of new negotiation which is called DOHRA DEVELOPMENT AGENDA.

AGREEMENT OF WTO

GATS (GENERAL AGREEMENT ON TRADE IN SERVICE)

Due to change in the nature of trade there is a need for the service sector incrasing day by day. All the developed country generate their maximum number of revenue from the service sector or from service industries. The rapid growth and changes in the trade practices promotes the member of wto to think for the service industries or think something for the service trade.afetr watching the need and demand WTO launches the new negosiable agreement called general agreement on trade and service. this agreement launched on 1 Jan 1995. This is important agreement which includes two parts one contain the rules and regulation of the agreement and another contain the schedule of nation who give the commitment to enter to the domestic nation by the foreign country. All the member country at=re considered as the most favored nations.

The GATS provide that trade to service can be provide in various ways some are as follows.

1. By international telephonic call2. By international tourism 3. By international service providing to the different country like open a branch of bank to

another country.

4. Individual can provide service to the other country like construction service provided to the other country.

TRADE RELATED INVESTMENT MEASURE (TRIMs)

This is one of the agreements of the WTO which is started to provide the equal rights to the foreign investment. This agreement tells about that there is no discrimination between the government and the foreign investment, this agreement refers to the certain restriction imposed by the government in respect of the foreign investment which is not discriminated by the member goverement. There are certain features of the trade related investment measure, which are as follows.

1. There should not any restriction in foreign capital.2. Providing equal rights to the foreign investor as compared domestic investor.3. Permission regarding the import of raw material should be provided in the beginning.4. There should not be any force for the foreign investor to use all product and material.5. There should not be necessary for the company to export the finished goods.

TRADE RELATED INTELLECTUAL PROPERTY RIGHTS (TRIPs)

This is one of the type of agreement of WTO in which something about the intellectual property. Since the 1980 the demand for the IP is increased. And this become the major issue in the international negotiation and in many condition it become a subject of dispute between the countries.IP rights should be termed as “information with commercial value” It has been characterized by the creative expression. It includes.

1. Patient protection2. Copyright3. Trademarks4. Layout design

DIFFERENCE BETWEEN WTO AND GATT

The general agreement of tariffs and trade was a mutual agreement to regulate or conduct international trade between the member countries. This agreement was set up in 1948 and run up to 1993.o the other hand world trade organization is formed in the e1995 with the purpose of liberalize the international trade between the member countries it is a replacement against gatt. GATT only deal deals with trade in goods but if we talk about world trade organization it dels with trade in goods and service and with the trade related aspects of intellectual property rights also. The main purpose of GATT Was to substantial reduction of tariffs and trade, and on the other hand The main purpose of WTO is provide liberal trade between the member countries it not only deal with the goods but also with the services and intellectual properties. The one of the main difference is gatt doesn’t have any permanent structure or any permanent framework to deal with the countries, but on the other hand wto has a permanent structure and framework to deal with the different member countries. If we talk about the scope than gatt only deals with the goods in the international trade between the countries but on the other point WTO deals with the other agreement too like service and also with trade related aspects of intellectual properties, Rights also. There is also a difference in the dispute solving issue of the both GATT has “permanent appellate body to finding” review and for the settlement of dispute. On the other side if we talk about wto than dispute are been solved much faster because there is a settlement system which has a selected time structure. These are the few main difference between the GATT and WTO.

World trade recorded its largest in each year in 2010 merchant exports increase to 14.5 percent by the growing by 3.6.percent of global output as measured by gdp. Trade and output are growing faster in developing countries as compared to developed countries. Exports were about to 13 percent in developed country and about 17 percent in developing countries. If we talk about the difference between the trade of developed country to developing country then there is rise in 11 percent in developed country as compared to 17 percent growth in developing country, it means world trade is increasing not only to the developed country but also to the developing country as a whole.

In the year 2010 the gdp is expanded is3.6 percentage and before one year it is said to be 2.4 percentages in the financial crises of 2009.The output of developed country is rose to 2.6 in 2010, and in 2009 its falling to 3.7 percent, the rest of the world gdp growing 7.1 percent in 2010 as it was falling to 2.3 percent in 2009. On the base of this data it is to be said that there is a growth in the entire world whether it’s a developed country or it’s a developing country trade is expanding toward growth in entire world. The growth is taken place by the first half of the year

after that in second half its weekend by sovereign debt crises which affect the smaller euro area economies.

In the last year the extreme growth is shown in the gdp of developing asia which is of 8.8 percent as compared to other developing region. With the higher growth rate registering by china and india as 10.3 and 9.7 percent. South America and central America shows the gdp growth of 5.5 percent and by brazilis 7.6 percent. Over the last five year the Gdp growing rate of Africa shown the faster average rate of 4.7 percent between 2005 to 2010.

In lasyt few year developed economy shows slowly than developing economies. The europien growth to rate down to 1.9 percent the slowest of any reason in 2010, there is a growth in the world trade not only in the one part of globe but in the overall part of the globe as respectively. There are some developed economy which nowadays also faster in the GDP as compared to developing economies.

The world export in rose to 14.5 percent in 2010 as compared to import grows as 13.5 perceWhich shows there is more export and less import.

Conclusion

On the base of above study it is concluded that WTO plays a very important role in world trade WTO is helping its member country. Wto solve the entire issue between the two country. On the bases if above study it is shows that world trade is in growing stage all the economies GDP is in growing rate. There is a competition in the entire economies. There are certain agreements created by the WTO in which all the necessary trade are consult. WTO always act as a corporate body between two countries to solve the dispute and make the country to freely trade between them