The WTO: The Unknown Organization
The World Trade Organization headquarters are located in Geneva, Switzerland. The current Director-General who leads the organization is Pascal Lamy who has recently replaced Supachai Panitichapdi of India on Septmeber 1, 2005. As of December 2005, there are 150 members on the WTO who have agreed to abide by its laws of trade and the agreements that have been signed. The beginings of the WTO started with the ITO, the International Trade Organization which was first created at the Bretton Woods conference in 1944. In 1948, the UNited Nations ratified the agreement in Havan Cuba but the United States Senate rejected it.
The U.S. Senate was worried that the organization would regualte and interfere with U.S. domestic trade and hurt rather than help its economy. In 1995, another attempt was created for a trade organization and this set up the World Trade organization. The only part of the ITO that still exists is the General Agreement on Tariffs and trade (GATT). Several rounds of negotiation were needed to finally get U.S. support and finally the U.S. decided to join. The WTO is different from hte ITO because it has an institutional structure.
Any member of the WTO cannot discrimnate against another member by putting up tariffs or sanctions agaisnt another member in the area of trade. The WTO has set up a dispute settlement board and an appellate division to hear cases to reverse decisions it has made. Every member nation has a representative that reports that nation’s concerns and goals to the organization. Other committees that the WTO has set up are Trade and Environment, Trade and Development, Regional Trade Agreements, Balance of Payment Restrictions, Budget Finance and Adminstration.
The WTO operates by a consensus vote. Each member nation has one vote. The decisions are made so that they are supported by a wide consensus of nations to prevent disputes from arising. The WTO also has a specially designed room called the “Green Room” where informal negotiations take place.
The main problem with the WTO is its inability to enforce any of its decisions. The U.S. has reneged on several of its deals it has made with other nations and has imposed sanctions or hs threateened other WTO member nations in the area of trade which is agaisnt the laws of the WTO. The WTO has no military and cannot threaten any nation if they do not hold the agreement they have signed to be true. This also makes the organization powerless and useless at times. However, for the majority part of the WTO’s history is has helped in pece and trade between member nations and is a beneficial organization in the world economy.
