WTO DISPUTE SETTLEMENT RULES

WTO Dispute Settlement Rules

WTO Dispute Settlement Rules

Introduction

The influence of WTO on developing countries has been long debated in the society; this paper focuses on the question of whether WTO has benefited developing countries in their involvement in international market. Firstly, the general background of WTO is provided, including its history, structure, and purpose. And the second part of the paper deals with different arguments towards the influences of WTO on developing countries. (Anderson:2002:123)These arguments are concerned with 3 main problems: 1) Whether developing nations losing out in world trade 2) If it is true that developed-country markets are more closed and protected, and whether developing countries are being forced to open up. 3) Whether poor countries are "marginalized" and are lacking of voice in WTO. The paper also acknowledges that inequality does exit, so a new round of negotiation is needed. Finally, it positively reaches the conclusion that WTO has benefited developing countries in their engagement in world trade and investment.

Background of WTO

The History of the WTO

General Agreement on Tariffs was replaced by the World Trade Organization in 1995. The following section is to look back the history of the WTO.

General Agreement on Tariffs (GATT)

As world trade and finance system was destroyed in the World War II, there was a need to build a new system. More and more politicians wanted to solve problems including problems of tariff and trade. Thus, GATT was established in 1947. GATT had four fundamental principles and several agreements. (Bagwell:2007:12)

World Trade Organization (WTO)

The World Trade Organisation was established in 1995, and superseded GATT. According to Dijck & Faber, the WTO provides the all-embracing trade principles to its Members on agricultural products, services, and some major trade-related areas. (Barth:Marchetti:Nolle:2006)

In contrast to GATT, WTO is an organization, not just an agreement. Moreover, the WTO is an international organization with legal status, which can restrict Members trade behaviours that violate WTO principle.

The Structure of the WTO

WTO is a formal international institution. The World Bank and International Monetary Fund is branch of the WTO. According to the Ministerial Conference is the highest authority of the WTO. It meets at least every two years. There are three bodies-----General Council, Dispute Settlement Body, and The Trade Policy Review Body, established by the Ministerial Conference. Moreover, the WTO has established a number of other committees. Every committee has different function to realise the objective of the WTO. (Blackhurst:Hartridge:2004:705)

The Purpose of the WTO

The purpose of the WTO is to implement, administer, and operate the rules on trade liberalisation, which were agreed to and signed by all members of WTO. However, Weiss states, "The cental function of the WTO is to safeguard the interests of citizens of small countries, developed and developing." (Weiss, 1996, p.80)

Different opinions towards the influence of WTO on developing countries Some people argue that WTO has protected interests for developed countries instead of developing ones, which results in the declination of developing countries' share in the world ...