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WORLD TRADE ORGANIZATION (WTO)




  • WORLD TRADE ORGANIZATION

    (WTO)

    Q.No. 1: What is World Trade Organization (WTO)?

    Ans . World Trade Organization is an international body that promotes and enforces trade laws and polices free trade agreements, oversee world trade practices and settle disputes among member states. It was established in 1994. When the members of General Agreement on Tariffs and Trade (GATT) signed a new trade pact. The WTO replaced and expanded the GATT agreement, which regulated trade in goods only to include trade in services and protection for intellectual property right. The WTO is based in Geneva (Switzerland) and is controlled by a general council composed of member states’ ambassadors.

    Q. No. 2: What are the main objectives of WTO ?

    WORLD TRADE ORGANIZATION

    (WTO) 

    Q.No. 1: What is World Trade Organization (WTO)?

    Ans . World Trade Organization is an international body that promotes and enforces trade laws and polices free trade agreements, oversee world trade practices and settle disputes among member states. It was established in 1994. When the members of General Agreement on Tariffs and Trade (GATT) signed a new trade pact. The WTO replaced and expanded the GATT agreement, which regulated trade in goods only to include trade in services and protection for intellectual property right. The WTO is based in Geneva (Switzerland) and is controlled by a general council composed of member states’ ambassadors.

    Q. No. 2: What are the main objectives of WTO ?

    Ans .  The main objectives of WTO are

    1. to raise standard of living;

    2. to ensure full employment;

    3. to promote the steady growth of real income and effective demand;

    4. To expand the production of and trade in goods and services! And ;

    5. Sustainable development and environment protection.

    Q. No. 3:  Mention the main function of WTO.

    Ans .  The main functions of WTO include.

    1. administering WTO trade agreements;

    2. forum for trade negotiations;

    3. handling trade disputes;

    4. monitoring assistance and training for developing countries and ;

    5. Cooperation with other international organization.

    Q. No. 4:  Which are one four basic principles of WTO?

    Ans.    The four basic principles on which main functions of WTO is based are

    1. trade without discrimination;

    2. growing access to markets;

    3. promoting fair competition;

    4. Encouraging development and economics reforms.

    Q. No. 5:   Enlist the main agreements of WTO?

    Ans .    The WTO is a home to series of agreements among the member states on different issues. Some of the important agreements are as follows.

    1. General Agreement on Tariffs and Trade (GATT) 1994;

    2. Agreement on Agriculture (AOA);

    3. Agreement on the Application of Sanitary and Phyto – Sanitary Measures (SPS);

    4. Agreement on Textile and Clothing (ATC);

    5. Agreement on Technical Barriers to Trade (TBT);

    6. Agreement on Trade Related Investment Measures (TRIM);

    7. Agreement on Pre-shipment Inspection;

    8. Agreement on Rules of Origin;

    9. Agreement on Subsidies and Countervailing Measures;

    10. Agreement on Safeguard;

    11. Agreement on Trade-Related Aspect of Intellectual Property Rights (TRIPS);

    12. Agreement in Government Procurement;

    13. International Dairy Agreement;

    14. International Bovine Meat Agreement.

    Q. No. 6:  Which agreements of WTO are likely to have severe impact on Pakistan’s agriculture?

    Ans.   The agriculture sector of Pakistan is likely to be affected with the implementation of following agreements of WTO.

    1. Agreement of Agriculture (AOA);

    2. Agreement on the Application of Sanity and Phyto-sanitary Measures (SPS);

    3. Agreement on Trade-Related Aspect of Intellectual Property Rights (TRIPS).

    Q. No. 7:  Briefly give the salient features of Agreement on Agriculture (AOA).

    Ans.   Agreement on Agriculture

    The Agreement on Agriculture (AOA) was made an important part of the earlier document of GATT during the Uruguay Round. The principal aim of the AOA pertains to improved market access through reduction of tariffs, reduction of domestic support and finally, the total elimination of trade distorting export subsides. It came into force on 1st January, 1995 but the implementation period is depending to countries specific commitment up to six year, however, developing countries has relaxation in implementation over a period of up to 10 years. The binding date for Pakistan is 1st

    January 2005. the terms of AOA are:

    1) Market Access: For greater access to member countries, the quotas, controls and tariffs be replaced by simple tariffs. Developed countries have reduced the tariff by 24% on an average.

    2) Domestic Support: the purpose is to discipline and reduce domestic support by 20% for developed countries and 13.3% for developing countries.

    3) Export Subsidy: the value of export subsidies be reduced by 36% for developed countries and 24% for developing countries. The volume of export subsidized quantities must also be reduced by 21% for developed countries and 14% for developing countries with base period 1986-90.

    Q. No. 8: Write short notes on.

    1) Agreement on Sanitary and Phytosanitary Measures (SPS)

    2) Agreement on Trade- related Aspect of Intellectual Property Rights (TRIPS)

    Ans.   Agreement on Sanitary and Phytosanitary Measures

    The agreement on the application of Sanitary and Phytosanitary Measures considered in parallel with the negotiation on AOA. The agreement deals with:

    1) Food safety;

    2) Animal health standards; and

    3) Plants health standards

    The SPS agreement itself does not set any standards for the Members but it encourages using international standards devised by the international organizations and also encourages the Member states to frame their own rules. However, the agreement discourages the Member countries to use SPS measures as protectionism in disguise.

    Agreement on Trade – Related Aspect of Intellectual Property Rights (TRIPS)

    Agreement is a new dimension of international system for protecting intellectual

    Property rights and to bring non – discrimination and transparency in the system.

    It gives trade and investments concept to ideas and creativity by framing the rules about copyrights , patents. trademarks, geographical names and identify products,

    Industrial design, integrated circuit layout – designs and undisclosed information such as trade secrets etc.

    Q. No. 9: What is the main key to be a gainer nation in WTO regime?

    Ans.        Competition in terms of price and quality is the only key to be a successful country in the WTO regime.

    Q. No. 10: When WTO will fully come into play?

    Ans.        WTO will fully come into play on 1st January 2005.

    Q.No. 11. Briefly give some major implications of WTO for agriculture of Pakistan.

    Ans.        Under the WTO. Support to frames in terms of price is to be reduced and market forces will determine the prices of the commodities on wards. In the absence of strong market forces and proper information system, small medium farmers are likely to be affected seriously and thereby it is expected that poverty will further escalate.

    Due to the SPS agreement, Pakistan’s agriculture export will face major challenges as in Pakistan quality culture is rarely given due consideration. Owing to TRIPS, payments will have to be made to multinational companies (MNCS) for the use of patents. This will be a major burden on the national exchequer.

    Q. No. 12. What Pakistan should do to face the challenges passed by WTO?

    Ans.        In order to cope with the challenges posed by WTO, following steps are required to be undertaken.

    1. To create awareness, conferences, seminars and talks on electronic and print media should be arranged to educate the scientists’ policy makers, farmers and the other stakeholders about various aspects of WTO.

    2. More resources should be allocated for undertaking research on commodities a) where Pakistan has comparative advantage and b) for commodities which have the potential to be exported.

    3. Pakistan should harmonies the equality of its products to internationally accepted standards, information dissemination to farmers on higher standards should be promoted, financial assistance extended and training imported to them on methods of attaining these standards.

    4. Diversification of export both in terms of product and market should be undertaken.

    5. Pakistan faces series challenges in the application of SPS and TRIPS. For this there is need to frame domestic laws on urgent basis.

    6. Permittable domestic support under the WTO rules should be explored to the benefit of large majority of small and medium farmers.

    7. Pakistan should actively participate in the future WTO negotiations so that its own agenda is ultimately incorporated into various agreements. In this regard, Pakistan can benefit by making alliances with other countries having common interests.

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