The World Trade Organization, commonly known as the WTO, is a global organization that oversees and regulates international trade. It is responsible for creating and enforcing rules and policies to ensure fair and efficient trade practices among its member countries. In this article, we will explain three major agreements of the WTO that have significant impact on global trade.
1. General Agreement on Tariffs and Trade (GATT)
The General Agreement on Tariffs and Trade (GATT) was signed in 1947 and served as the foundation of the WTO until it was replaced by the WTO Agreement in 1994. The GATT focused on reducing and eliminating trade barriers such as tariffs and quotas and ensuring equal treatment of all member countries in trade relations. It provided a framework for negotiations on trade agreements and dispute resolution.
Under the GATT, member countries agreed to lower their tariffs and trade restrictions gradually over time, leading to increased trade and economic growth. Today, the principles of the GATT are still incorporated into the WTO`s rules and policies.
2. Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)
The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) was signed in 1994 as part of the WTO Agreement. It is a comprehensive agreement that outlines the minimum standards for the protection and enforcement of intellectual property rights such as patents, trademarks, and copyrights.
TRIPS aims to promote innovation and creativity by providing legal protection for intellectual property rights. It also ensures that member countries maintain a level playing field and do not discriminate against foreign companies or individuals in their intellectual property laws.
3. Agreement on the Application of Sanitary and Phytosanitary Measures (SPS)
The Agreement on the Application of Sanitary and Phytosanitary Measures (SPS) is another important agreement of the WTO. It aims to protect human, animal, and plant health by ensuring that trade in food and agricultural products is conducted in a safe manner.
Under the SPS, member countries must ensure that their food safety and plant health regulations do not discriminate against foreign products or unduly restrict trade. They must also base their regulations on scientific evidence and avoid creating unnecessary barriers to trade.
In conclusion, the WTO plays a crucial role in regulating global trade, and its agreements such as GATT, TRIPS, and SPS have significant impact on trade relations among its member countries. Understanding these agreements and their implications is important for businesses operating in the global market.