Functions/Role and Benefits of WTO

Functions/Role of WTO

WTO performs the following functions

·           It is a forum for negotiation and formalization of trade agreement among the member countries.

·           It settles disputes and grievances relating to trade among the member countries.

·           It frames commonly  acceptable  code of conduct in order to reduce trade barriers.

·           It holds consultations with IMF and World Bank(IBRD) and its affiliates to bring about a greater understanding and co-operation in global economic policy making.

·           It supervises the operations of agreement relating to General Agreement on Tariffs and Trade(GATT) and Trade-Related Intellectual Properties Rights (TRIPS)

·           It regulates trade between participating countries.

Benefits of WTO

Some of the major benefits of WTO are as follows.

1.        WTO is promoting international peace and creating a conducive environment for conducting international trade

2.        It settles the trade disputes amicably among the member countries.

3.        It promotes the standard of living of people by increasing their income level from free trades

4.        WTO has removed quantitative restrictions and non-tariff barriers. It  has facilitated free flow of foreign trade among the member countries. The countries can impose import restrictions only to correct balance of payments difficulties and not otherwise.

5.        It stimulates economic growth of developing countries by providing them with much needed capital and giving them preferential treatment in trade related matters.

6.        WTO organizes periodical regional and international conference. Thus developing countries get opportunity to learn the technicalities, rules and regulations governing world trade, technical assistance available globally, trade  potentials in member countries and so on.

7.        WTO gives people across the world a wider choice of goods and broader range of qualities of goods to choose from by promoting free trade among the member countries.

8.        WTO has lowered trade barriers and thereby allowed trade  to  flourish across the world. The increase in trade contributes to increase in national income and personal income of people

9.        WTO provides a platform for member countries to establish trade links with one another. In the absence of WTO member countries may have to enter many multilateral agreement with so many countries across the world. It provides a greater access to all nations under one roof.

10.   WTO is committed to protecting free trade. It has framed rules on subsidies and dumping.