ppt on wto

Overview of WTO Agreements: Past, Present and Future

Dr. Harish Anand

Economist

Presentation made to Faculty members of Master of Business Management, RIMT, Govindgarh,

Punjab

International trade : An engine of economic growth

Ricardo’s Comparative Advantage Theory

David Ricardo, 1772-1823

Evolution of WTO: The Rising of Expectations

1930’-1948s

1948 -1961

1964-1967

1973-79

Trend Continues…

ITOGATT

1986-94

1995-2001

Trend Continue…

Kennedy Round

Tokyo Round

Uruguay Round

WTO and Doha Round

What is expected from World Trade Organisation

Promotion of Free Trade

Trade Dispute settlement forum

Developmental concerns

Growing influences of developing countries

Whether ‘the expected’ is delivered: NAMA

Direction is right but process is slow

Difficulties are many on the road to free trade

1. Formula for tariff cut-Swiss formula, coefficient

contentious issue, LTFR for developed countries( 30%

Vs 60%)

2. Flexibility for DC from applying Swiss formula

3. Anti-concentration clause

4. Sectoral negotiations: USA identify four sectors

High Tariff and Tariff Peaks

USA EU India

Average Import Tariff* 3-4% 3-4% 15%

Tariff on Textile and clothing

9-32% Up to 12% 15%

Tariff on industrial products

* Based on average tariff of developed countries on import of developing counting , HDR 2005

Tariff Escalation

4%

9%-12%8%

12%-15%UP TO 12%

20%-32%

0%

5%

10%

15%

20%

25%

YARN FABRIC GARMENTS

IMPORT TARIFF ON TEXTILE PRODUCTS: PERVERSE GRADUATION

EU

USA

Whether ‘the expected’ is delivered: Agriculture

Market access

Level of export subsidy

Level of domestic subsidy Amber box Blue Box Green Box

No firm commitment by Developed countries EU USA –difficult demands

Whether ‘the expected’ is delivered: Other areas

Services sector Mode 3- commercial presence Mode 1- export of services Mode 4- Movement of natural person

Investment : Export obligations

Competition policy-Government procurement

Intellectual Propriety Rights- Essential Medicines

Trade and Environmental concerns

US President Trade Policy Agenda(2009): Making Trade Work for American Families

Trade is beneficial … it respects the right of workers…

Trade a tool kit to addressing environmental challenges

What United states would be expected to give is well

known but broad flexibilities available to other leaves

unclear the value of new opportunities for our workers

Government procurements and market regulations in

partner countries

Margin of preferences for poorest of countries

WTO: Is Doha Round failure is end of MTS under WTO

Principle of Non Discrimination: GATT Article-1

MFN tariff and National treatment. However, there are some exceptions:

BOP problem, Infant industry, Special and differential

treatment

GSP treatment

Reasons for RTAs

RTAs Limitations (Jacob Winner )

Whether “SPAGHETTI BOWL” PTAs are complementary or undermine MTS

Question 1: Will PTAs give incentive/disincentive to

members to bring in more non-members in PTAs

Question 2: Whether PTAs handicapped or prompt

member countries to liberalise trade to non member

countries

(WTO 1995 study and WTO 2005 study)

Non trade issues and MTS under WTO

How to deal with PTAs/RTAs

WTO and Sovereignty of Nations: A Real Concern or Hype overblown

WTO rules restrict ‘Policy Space’ for DCs.?

A challenge to traditional thinking on sovereignty

Regulating global companies, global factor, goods

and service markets

Sovereignty reclaimed

WTO: Coordination with other international organisations

Growing ‘internalization of world’ Global finance-Role of FII in Indian stock market

Growing need for WTO to co-ordinate with other international agencies like World Bank, IMF, ILO and UNEP

WTO Dispute Settlement Mechanism and emerging international trade flow

Growing use of DSM facilities with variegated level

of interest in WTO than GATT

Frequency of using DSM

Regime interplay –non economic factor

consideration

Way forward

WTO: Legitimacy concerns

Growing role of civil society (NGOs)

It reflects public opinion on trade, foreign, social, environmental policy areas and found to be useful

Issues like core labour standards have been raised in Ministerial Declarations

Public health and trade linkage is another issue especially in IPR e.g. Case of life saving medicines

WTO: Structural and procedural issues; Decision making and variable geometry

Structure and procedures need revisit-consensus

Variable geometry : Tokyo Round, PTAs, S&D treatment

Alternatives to Single Undertaking

Increased political reinforcement for commitment made at WTO

Tailoring Commitments for LDCs

Focus on capacity building

Contractual agreement for financial support

Technical assistance

Longer implementation period and lower

commitment

Complete waiver should be avoided to avoid

complacency

Some potential areas for WTO coverage

Excess supply to stressed supply: Food Security

Concerns-Bio-fuel

Oil and energy security-Oil cartels

Sovereign wealth funds and national security:

Excess liquidity leading to saving gut

Trade and environment concern linkages

WTO AGREEMENTS: INDIAN PERSPECTIVE

GOVERNMENT LEVEL China factor Growing interest in oversea markets

Exports, FDI, Service exports (Mode 4) Global finance –Mandi Govindgarh case To handle new challenges in emerging environment

INDUSTRY

ACADEMIC

Thank You