The World Trade Organization (WTO) is an intergovernmental organization headquartered in Geneva, Switzerland[1] that regulates and facilitates international trade.[2] Governments use the organization to establish, revise, and enforce the rules that govern international trade in cooperation with the United Nations System.[2][3] The WTO is the world's largest international economic organization, with 164 member states representing over 98% of global trade and global GDP.[4][5][6]
The WTO facilitates trade in goods, services and intellectual property among participating countries by providing a framework for negotiating trade agreements, which usually aim to reduce or eliminate tariffs, quotas, and other restrictions; these agreements are signed by representatives of member governments[7]: fol.9–10 and ratified by their legislatures.[8] It also administers independent dispute resolution for enforcing participants' adherence to trade agreements and resolving trade-related disputes.[9] The organization prohibits discrimination between trading partners, but provides exceptions for environmental protection, national security, and other important goals.[9]
It officially commenced operations on 1 January 1995, pursuant to the 1994 Marrakesh Agreement, thus replacing the General Agreement on Tariffs and Trade (GATT) that had been established in 1948.
Its top decision-making body is the Ministerial Conference, which is composed of all member states and usually convenes biennially; consensus is emphasized in all decisions.[10] Day-to-day functions are handled by the General Council, made up of representatives from all members.[11] A Secretariat of over 600 personnel, led by the Director-General and four deputies, provides administrative, professional, and technical services.[12] The WTO's annual budget is roughly 220 million USD, which is contributed by members based on their proportion of international trade.[13]
Studies show the WTO has increased trade and reduced trade barriers.[14][15][16][17] It has also influenced trade agreement generally; the vast majority of preferential trade agreements (PTAs) explicitly reference the WTO, with substantial portions of text copied from WTO agreements.[18] Goal 10 of the United Nations Sustainable Development Goals also referenced WTO agreements as instruments of reducing inequality.[19] However, critics contend that the benefits of WTO-facilitated free trade are not shared equally.[20][21]
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