World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. It regulates and facilitates trade between nations. WTO commenced its operations on 1 January 1995, replacing the General Agreement on Tariffs and Trade (GATT) that had been established in 1948 following World War II.
World Trade Organization settles trade disputes between its members, and it supports the needs of developing countries. It operates with principles of non-discrimination, reciprocity, binding and enforceable commitments, transparency, and safety values.
WTO is considered as a major facilitator of globalization that works in tandem with other forces, the IMF and the World Bank. It envisions a borderless trade. Hence, its main function is to ensure that trade flows as smoothly, predictably, and freely as possible.
World Trade Organization covers three areas – trade in goods, trade in services, and intellectual property rights whereas its predecessor GATT was only concerned with the trade in merchandise goods.
What Are the Objectives of WTO?
The objectives of World Trade Organizations include:
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- To help in the economic development of developing and least developed countries and to participate them in international trade.
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- To increase trade liberalization, gradually removing barriers.
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- To safeguard and develop the basic principles of the multilateral trading system.
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- To ensure full employment and to raise income.
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- To raise the standard of living.
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- To ensure sustainable development.
Nepal and World Trade Organization
Nepal became the 147th member of the World Trade Organization on 23rd April 2004, the first LDC to enter the organization through a full working party negotiation process. Membership in WTO opens up the possibility for wider market access, rule-based trade, integration with the global economy, and access to the dispute settlement process.
WTO helps Nepal enhance its efficiency of enterprises and make the economy more competitive by promoting a better business environment. Nepal’s membership in WTO has the following advantages:
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- Market access for Nepalese products.
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- Transfer of technology and foreign investments.
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- Technical assistance and training to enhance the efficiency of the government.
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- Credible forum for trade dispute settlement.
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- Transit rights.
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- Protection of domestic industries through tariff/domestic regulation.
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- Protection of consumer’s rights.
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- Employment generation, export promotion, and economic growth.
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- Opportunity for improving global competitiveness.
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- Patent rights in biodiversity and other indigenous knowledge.
