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World Trade Organization
Transcript of World Trade Organization
Hope you enjoy your candy.
General Agreement of Tariffs and Trade
World Trade Organization
Please pay attention throughout the presentation as there will be questions worth prizes in the end!!!
nations at one time
Periods of time after the second world war where GATT, later WTO, took action in order to make trade more smooth and work towards its goals. Each round was similar but focused on different aspects of its mission statement
a type of economic or political system which gives individuals their freedom and restricting but not eliminating the government control
General Agreement on Tariffs and Trade
International Trade Organization
a team of multicultural people who give technical and professional support, technical help for developing countries, monitor and analyze developments in trade and help countries become a member of the WTO
What is GATT?
Stands for the General Agreement on Tariffs and Trade
Began as multilateral negotiations with the goal of a reduction in trade barriers, it slowly grew larger
It was created in 1947 and put into action in 1948
128 countries had signed GATT by 1994
GATT held a total of nine rounds, the ninth of which is currently going on
It was made to join the World Bank, and the International Monetary Fund (both created in Bretton Woods) as a tool to combat economic globalization
The goal of GATT was to reduce or eliminate tariffs
The Delegation at Bretton Woods in 1944
What is the WTO???
The World Trade Organization is the only international organization that deals with the rules of trade between nations on a global level. It helps the trade flow between countries to be very smooth and accommodates the
developing countries get
The countries that are a part of the WTO presently:
Albania, Angola, Antigua and Barbuda, Argentina, Armenia, Australia, Austria, Bahrin, Bangladesh, Barbados, Belgium, Belize, Benin, Bolivia, Botswana, Brazil, Brunei Darussalam, Bulgaria, Burkina, Burundi, Cabo Verde, Cambodia, Cameroon, Canada, Central African Republic, Chad, Chile, China, Colombia, Congo, Costa Rica, Côte d'lvoire, Croatia, Cuba, Cyprus, Czech Republic, Democratic Republic of Congo, Denmark, Djibouti, Dominica, Dominican Republic, Ecquador, Egypt, El Salvador Estonia, European Union, Fiji, Finland, France, Gabon, The Gambia, Georgia, Germany, Ghana, Greece, Grenada, Guatemala, Guinea, Guinea-Bissau, Guyana, Haiti, Honduras, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Isreal, Italy, Jamaica, Japan, Jordan, Kenya, Korea, Kuwait, Kyrgyz Republic, Lao People's Democratic Republic, Latvia, Lesotho, Liechtensein, Lithunia, Luxembourg, Macao, Madagascar, Malawi, Malaysia, Maldives, Mali, Malta, Mauritania, Mexico, Moldova, Mongolia, Montenegro, Morocco, Mozambique, Myanmar, Namibia, Nepal, Netherlands, New Zealand, Nicaragua, Niger, Nigeria, Norway, Oman, Pakistan, Panama, Papua New Guinea, Paraguay, Peru, Phillipines, Poland, Portugal, Qatar, Romania, Russian Federation, Rwanda, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and Grenadines, Samoa, Saudi Arabia, Senegal, Sierra Leone, Singapore, Slovak Republic, Slovenia, Solomon Islands, South Africa, Spain, Sri Lanka, Suriname, Swaziland, Switzerland, Chinese Taipei, Tajikistan, Tanzania, Thailand, The former Yugosiav Republic of Macedonia, Togo, Tonga, Trinidad and Tobago, Tunisia, Turkey, Uganda, Ukraine, United Arab Emirates, United Kingdom, United States of America, Uruguay, Vanatu, Venezuela, Vietnam, Zambia, and Zimbabwe.
Who created the WTO?
It was the result of the Uruguay Round of Negotiations of 1986 to 1994. There were several negotiations that were done in Bretton Woods and that resulted to the creation of the World Trade Organization
By: Advikaa Dosajh and Sheila Rasouli
More Open Trades
Predictable and Transparent Trades
Benefit the Under Developed Countries as well
Amend Past Mistakes
Protect the Environment
They help in many ways in international trade for example:
Implementation and monitoring of the country's activities
Disputes on settlement of trade
Building the trade capacity of developing countries
What they do:
minimize or end tariffs and other trading barriers
applying the rules into the trade
settling the disputes between countries
giving developing countries the opportunity to grow through trade
get more countries to join the WTO
educate the society about the WTO
Why did they change from
GATT to WTO?
1. Wanted a world wide trade to regulate the organization
2. GATT was only for the trade in the merchandise industry but they wanted something that was more vast
3. GATT was very lenient on the qualifications and commitments a country must keep in order to remain a member
4. WTO was much faster in settling disputes, more automatic, and less susceptible to blockages
5. The WTO is a much more permanent system in comparison to GATT because GATT had many unstable practices and its secretariat was also temporary
The WTO has the privilege to control the following:
cut living costs and raise living standards
settle and reduce trade tensions
stimulate the economy of the country and create jobs to reduce unemployment
reduce prices of businesses internationally
promote good governing habits
help countries grow
give a voice to the unheard
help improve the environment of the world
create peace and stability
be effective in reform
Actions taken by WTO after its birth
The GATT ministers meet for the final time under that name in Morocco to establish the WTO
The WTO is created in Geneva, Switzerland
Meet in Doha, Qatar to negotiate on opening the markets to agricultural, manufactured goods and services
WTO agrees with the penalty of 4 billion dollars on US imposed by EU over tax breaks on US exports. Largest penalty awarded by WTO!!!
WTO gives developing countries access to cheap medicines. Calls out the additional taxes that US applied to imported steel.
EU and WTO will reduce agricultural while developing nations will lower tariffs on goods
Pascal Lamy takes over the WTO. US promises to make large agricultural subsidies if EU does the same
Tension between US and EU with the WTO and China breaking the trade rules by adding additional taxes on the export of key materials. WTO calls out Philippines on their additional payment on alcohol. Russia finally joins WTO after 18 years of negotiation
WTO deny China's appeal against the ruling of breaking the free trade agreement
159 countries in total
Current Event: The Doha Negotiations
The Doha negotiations are the ninth round after the second world war and the first since the WTO became a multilateral trading system in 1995. All the 159 countries are a part of the negotiations and their aim was to deal with the deficiencies in the agreements that already existed in the WTO and to bring about changes to those agreements in order to make the system more beneficial. The WTO and EU also wanted to reduce several subsidies in many criteria to make the system based more on free trade. There were certain areas that were the major parts of the negotiations, such as:
1. Agriculture: Cotton 6. The Environment
2. Non-Agricultural market access 7. Intellectual Property rights
3. Services 8. Other Intellectual property issues
4. Trade Facilitation 9. Dispute Settlement
WTO a blessing or a curse???
Pros and Cons
a) promotes free trade
b) raises the worlds economy on a whole and the production rate
c) establishes a standard and a non-biased set of rules the countries must abide by to increase efficiency
d) helps countries world wide be at par with one another by giving the under developed countries more time to adjust
e) encourages trade and competition so consumers have choice and the best price/quality
f) acts as a platform of negotiations between the countries
a) unequal benefits to the third world countries or under developed countries
b) unfair terms of trade that benefit the Western Countries more than the third world countries
c) the WTO is more influenced by the European and Western countries, which is evident by the higher voting power, thus the negotiations end up in benefit of the European or Western countries
Black Tuesday marks the beginning of the depression. Markets crash and the economies of the world begin to drop.
As the economic depression grows, protectionist measures appear. The Smoot- Hawley Tariff Act becomes effective in the year 1930.
Germany invades Poland in 1939, the year many claim World War 2 began.
The Conference at Bretton Woods takes place.
The UN officially comes into existance.
The Conference at Bretton Woods produces the World Bank and International Monetary Fund, both of which become operational in 1945.
Talks with 23 countries begin regarding the liberalization of trade, and correcting the extreme protectionist measures which had remained from the early 1930s.
GATT is signed by 23 countries in Geneva, Switzerland.
GATT comes into effect on January 1.
The Charter of the International Trade Organization is signed, but the US Congress blocks it's legislature and the ITO falls apart. The US congress refused to agree to the ITO's charter on the grounds that it would give too much power to an international body.
The History of GATT
The beginning of the seventh round, called the Tokyo Round starts in Japan with 102 countries attending. The goal is to reduce not only tariffs, but trade barriers as well.
The seeds of the Uruguay Round are sown at a Ministerial Meeting of GATT members in Geneva.
In Punta del Este, Uruguay, the Uruguay Round begins with 123 countries present, it is considered the biggest negotiation mandate on trade ever agreed on.
The 'Final Act' of the Uruguay Round is completed, fulfilling every part of the Punta del Este mandate, with the exception of market access results. For the next two years, negotiations in Geneva would move from failure to success.
The World Trade Organization is created in Geneva.
Trade ministers meet for a final time under GATT in Morocco to establish the WTO and complete the Uruguay Round.
1. GATTs main goal was to reduce trade ______.
2. GATT was created in 1947, in ______ Switzerland.
3. ________ _______ marked the beginning of the depression.
4. Germany invaded Poland in 1939, which many believe was the beginning of ______ ______ ____.
5. ______ countries are part of the WTO today.
6. The WTO was the result of the ______ Round of Negotiations 1986-1994.
7. WTO is the only ___________ organization that smooths the trade between countries.
8. The WTO agreed with the penalty of 4 billion dollars on the US imposed by ____ due to the taxes applied on the countries exports.
1. Give me three reasons why the GATT changed to WTO.
2. Why did the US Congress refuse to ratify the Internatioal Trade Organization?
Other Current events
1. April, 25 - 2014: China files a appeal in the rare Earth disputes
2. April, 28 - 2014: India initiates a safegaurd investigation
3. April, 30 - 2014: Russia files a dispute against the European Union over regulations in the energy sector
*1-Awesome numbers calculated by Sheila
The Successes and Failures of GATT
Countries were able to increase their ability to trade with each other and gain the benefits of trade
In total, over the 47 years that GATT acted as the only governing body or agreement that acted towards international trade, it has exchanged some 13,700 tariff concessions*1, cut more than $347.4 billion in tariffs of world trade, and has dropped the average tariff rates on manufactured goods from 40% (before GATT) to 4% by the Uruguay Round*2.
The Tokyo Round failed to fix fundamental problems affecting farm trade and create a modified agreement regarding "safeguards" (emergency import measures)
GATT was provisional, with a limited field of action
GATT's success in reducing tariffs drove governments to create other forms of protection regarding international trade; this reduced the credibility and effectiveness of GATT
By the 1980s GATT was no longer relevant