Page 282 - DMGT401Business Environment

Unit 13: World Trade Organization

The accession process has four stages: Notes
1. First, the government applying for membership has to describe all aspects of its trade and
economic policies that have a bearing on WTO agreements. This is submitted to the WTO
in a memorandum which is examined by the working parties dealing with the country's
application. These working parties are open to all WTO members.

2. Second, when the working part has made sufficient progress on principles and policies,
parallel bilateral talks begin between the prospective new member and individual
countries. The talks determine the benefits (in the form of export opportunities and
guarantees) other WTO members can expect when the new member joins.
3. Once the working part has completed its examination of the applicant's trade regime, and
the parallel bilateral market access negotiations are complete, the working party finalises
the terms of accession. These appear in a report, a draft membership treaty ("protocol of
accession") and lists ("schedules") of the members to-be's commitments.
4. Finally the report, protocol and lists of commitments, is presented to the WTO General
Council or the Ministerial Conference. If a two-thirds majority of WTO members vote in
favour, the applicant is free to sign the protocol and to accede to the organization.

13.5 Regional Groups in WTO

Many groups operate in the WTO. Some are for economic integration – custom unions, free
trade areas, and common markets, such as the European Union, ASEAN, NAFTA and MERCOSUR.
These groups of countries, when they adopt common positions, can reach a consensus more
easily. Sometimes specific groups are created to compromise and break a deadlock. But there are
no hard and fast rules about the impact of groupings in the WTO.
The largest and most comprehensive group is the European Union and its 15 member states for
legal reasons known officially as the "European Communities" in WTO business. The European
Commission alone speaks for the EU at almost all WTO meetings. The EU is a WTO member in
its own right as are each of its member states.
Association of South East Asian Nations (ASEAN) members also coordinate positions among
themselves and speak with a single voice in the WTO. The role of a spokesman rotates among
ASEAN members and can be shared according to the topic.
There are many other groupings which occasionally present unified statements: the African
Group, the least-developed countries, the African, Caribbean and Pacific Group (ACP) and the
Latin American Economic System (SELA).

Task Find out facts related to establishment of WTO. What factors were
responsible for its emergence, what were initial issues etc.

13.6 Advantages/Benefits of WTO

The WTO has proved its worth in the past years. After its inception with only 23 members, it
now has more than 150 members. Its members include even communist countries like China,
and more countries like Vietnam and Laos are eager to gain its membership because it gives
many advantages to member countries. It is a forum where everybody wins by making others
win. A few distinct advantages of the WTO are:
1. The system helps promote peace

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