eight months were needed, until 1 January 1995, for national legislatures to ratify
the agreements and allow the World Trade Organization to enter into force.
was already the starting signal for breathing life into the WTO agreements, and launching
follow-up work on unfinished business of the Uruguay Round.
That work has
continued without pause ever since, mostly among trade negotiators in Geneva, backed up by
their governments at home, but also in meetings of the WTOs guiding Ministerial
Ministerial Conference took place in Singapore, in December 1996. The second was held in
Geneva, in May l998, and was coupled with a separate meeting, attended by many heads
of state or government, to celebrate the 50th anniversary of the multilateral trading
Ministerial Conference from 30 November to 3 December 1999 is the third in
this series of top-level meetings of the member governments of the WTO, and perhaps the
most important so far.
tasks of WTO member governments at the Seattle meeting, as at its two predecessors, are
- review what
the WTO has been doing
- assess the
present situation of world trade and international trade relations, to identify challenges
that the multilateral trading system must meet
- agree on the
WTOs work programme for the months and years ahead.
What the WTO has been doing
Much of the
work the WTO has been doing since the Marrakesh meeting consists of tasks defined in the
WTO agreements themselves.
Many of these
tasks are never-ending. Each agreement that sets out rules for an area of trade policy
for instance, for aligning customs valuation procedures, restricting subsidies to
agriculture, or avoiding unnecessary technical barriers to trade requires that
governments keep one another informed of what they are doing to meet their commitments.
meetings of experts are needed to discuss progress, allow mutual questioning, and clear up
misunderstandings or difficulties. These specialized meetings also allow members to
develop their ideas on how cooperation might be extended, either to overcome shortcomings
in existing agreements or to respond to new developments.
example is an across-the-board examination in the WTO over the past year of whether the
trade rules need adjustment to cover the explosive growth of electronic commerce, which is
doubling every 100 days. Another continuing task is the regular reviews of national
trade policies. These are not concerned with whether a country is living up to its WTO
obligations, but with allowing members to understand each others trade policies,
practices and problems and to offer comment.
agreements signed in Marrakesh also called for a very large number of specific tasks to be
undertaken, including further negotiations. This is the so-called built-in
agenda, recognized by all member countries as work to which they are jointly
Some of these
tasks were tackled immediately after the Marrakesh meeting. Others, such as reviews of
experience with particular agreements (for instance, the new dispute settlement rules, and
the agreement on protection of intellectual property) were to take place only after some
years: most have now fallen due, or will do so very soon.
commitments for the immediate future, on which the Seattle meeting will certainly focus,
require renewed negotiations to reform policies affecting agricultural trade and open up
world markets for trade in services.
services following Marrakesh
priority after Marrakesh was to carry forward services negotiations that had not been
completed during the Uruguay Round. Four separate negotiations were needed: on basic
telecommunications, financial services, maritime transport and movement of natural
basic telecommunications services was reached in February 1997. It involved
69 governments, accounting for more than 90 per cent of the $600 billion
world market for basic telecommunications in 1996. Members made far-reaching commitments
to open their markets. Many also accepted a set of regulatory principles, designed to
ensure that trade liberalization could not be frustrated by anti-competitive behaviour.
Many countries saw commitments in the telecommunications sector as a way of taking maximum
advantage of new information technologies, and associated investments, in view of the
extraordinary opportunities offered by these technologies as an instrument of development.
negotiations on financial services, another huge sector essential to the functioning of
the world economy, were particularly difficult, but also highly successful. Seventy
governments reached agreement in December 1997 on commitments to open their markets
for banking, insurance and securities trading. In this negotiation, too, the participants
accounted for more than 90 per cent of the world markets concerned.
negotiations on maritime transportation services did not succeed: participants suspended
them in 1996, agreeing that, with no satisfactory liberalization package yet in sight,
they would do better to return to the subject as part of the broader services negotiations
that will start in 2000.
negotiations on movement of natural persons, a matter of particular interest to developing
countries, were completed more quickly, in mid-1995, with modest results.
agenda also requires negotiations to fill in gaps in the General Agreement on Trade in
Services, which still lacks agreed rules for subsidies, safeguard action and government
post-Uruguay Round market-opening achievement was the Information Technology Agreement
(ITA), reached in March 1997 after an extra boost given to negotiations by the
Singapore Ministerial Conference of December 1996.
countries, responsible for 93 per cent of trade in information technology products,
committed themselves to remove all tariffs, by the year 2000, on computers, telephones and
many other telecom products, semiconductors, software and scientific instruments. Trade in
information technology products accounts for some 12 per cent of total world trade
more than the share taken by agricultural products.
negotiations continue, with the aim of eliminating tariffs on still more information
Also at the
Singapore meeting, countries which had agreed in the Uruguay Round to remove tariffs on
imports of a large number of pharmaceutical products added another 400 products to
their duty-free lists.
talks on new subjects
meeting added new tasks to the WTOs workload. Working groups were set up to examine
the relationship between trade and investment, and to study the interaction between trade
and competition policy. In both cases, investment and competition policy, the subjects
were controversial, and ministers agreed that the work must not prejudge whether
negotiations would take place, and that any decision to launch negotiations would require
was also established to study transparency in government procurement practices (and to
consider what might go into an agreement on the subject), and the WTOs Goods Council
was directed to see if new rules might help efforts to ease and simplify trade procedures.
All four subjects are likely to be discussed in Seattle.
important items on the WTOs built-in agenda are work on trade problems of the
least-developed countries and study of the relationship between the trading system and
trade problems of the
provisions in individual WTO agreements that take special account of least-developed
countries, the Marrakesh package included a decision not to require these countries to
undertake commitments or concessions inconsistent with their development, financial and
trade needs, or with their administrative and institutional capacities.
set up a process of regular reviews, and called for flexible and supportive
application to them of the WTO agreements, as well as technical assistance.
Singapore meeting, ministers agreed on a plan of action to help least-developed countries
respond to opportunities offered by the trading system. This led to a high-level meeting
called by the WTO in October 1997 aimed at countering the marginalization of the
was that 19 developed and developing countries announced measures giving some
products of least-developed countries new or improved preferential access to their
markets. Another was the launching of an integrated programme for technical assistance to
identifies specific trade-related needs of each country, and brings together the WTO and
five other agencies (IMF, ITC, UNCTAD, UNDP and World Bank) to coordinate their own
responses and help enlist further aid from bilateral donors.
trade and the environment
issues had already been under study in the GATT before the end of the Uruguay Round.
ministers decided that the WTO must pursue this work, agreeing that there need be no
contradiction between an open, non-discriminatory and equitable multilateral trading
system on the one hand and acting to safeguard the environment and sustainable development
on the other. Ministers also underlined that the WTO should not stray into areas beyond
WTOs Committee on Trade and Environment has met regularly since then, exploring the
relationships between WTO rules and multilateral environmental agreements, environmental
taxes and standards, and labelling and packaging requirements, as well as the effects of
environmental measures on exports of developing countries, and environmental advantages of
removing trade restrictions and distortions.
The WTO has
also held various symposia, most recently a two-day symposium earlier this year which
brought trade and environment policy makers from member governments, intergovernmental
organizations, academia, and non-governmental organizations together to discuss these
has been heightened by the attention given to several high-profile disputes related
to environmental issues and brought to the WTO by developing countries. For more on this
subject, see the next section of this booklet.
record of what the WTO has been doing since the Marrakesh meeting must take account of two
major and continuing tasks: its efforts to settle trade disputes among members, and nearly
40 separate negotiations on the terms of accession of countries that have applied to
join the WTO.
observers, the WTOs dispute settlement procedures are its most striking feature.
In the last
resort, dispute judgements of the GATT, like those of most other international agreements,
could not be enforced if a member government chose to disregard them. In contrast, the WTO
dispute rules have teeth. They apply across the whole range of WTO agreements on goods,
services and intellectual property protection, and decisions by the WTO Dispute Settlement
Body on conclusions of dispute panels or the Appellate Body cannot be blocked by a country
which loses its case.
found to have failed to meet a WTO obligation can be required to put the matter right and,
if it does not, the complainant may be authorized to take retaliatory trade measures.
for the first time in 1999. Dispute settlement is a large and growing part of the
WTOs work. Between January 1995 and August 1999, WTO members invoked the
settlement procedures 183 times over 142 distinct matters, through formal
requests for consultations (the first stage in handling an official complaint). The GATT
dispute procedures were invoked only about 300 times in 48 years.
are resolved through consultations, without requiring establishment of a formal panel to
examine the complaint.
the most recent twelve-month figures on disputes, to July 1999, show that
39 consultation requests were made, 17 panels were established, and eight final
reports by panels or the Appellate Body were adopted, while two panel proceedings were
halted because the parties had resolved their dispute.
was authorized in two cases in which the losing party failed to bring its disputed
practices into line with the rules. The dispute settlement system stands as a commitment
by governments to the rule of law and civilised engagement, an example of what could be in
other arenas of conflict and potential conflict.
and new members
almost 40 governments have provided solid evidence of the attractions of membership
in the multilateral trading system, by applying to accede to the WTO.
present time, following accessions by countries which have completed negotiations, the
waiting list to join still stands at over 30 countries. They range in size from China
and the Russian Federation, the two largest trading powers not yet within the system, to
small least-developed and island countries. Many are in transition to a market economy.
process is inevitably slow, as it involves alignment of the applicants trade
policies and legislation with the WTO rules, as well as bilateral negotiations on
commitments to open up its markets for goods and services. Technical assistance is often
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