WORLD TRADE ORGANISATION (WTO)

1. Context

2. What is WTO?

• The World Trade Organization is the only international organization that deals with the rules of trade between countries.
• The WTO officially commenced in 1995 under the Marrakesh Agreement signed by 124 nations, replacing the General Agreement on Tariffs and Trade (GATT).
• Currently, it has 164 members and 23 observer governments (like Iran, Iraq, Bhutan, Libya, etc).
• According to its rules, all decisions are taken through consensus and any member can exercise a veto.
• It aims to promote free trade, which is done through trade agreements that are discussed and signed by the member states.
• The WTO also provides a forum for countries to negotiate trade rules and settle economic disputes between them. 

3. What is WTO's Ministerial Conference?

• The Ministerial Conference is the WTO’s top decision-making body and usually meets every two years.
• All members of the WTO are involved in the Ministerial Conference and they can take decisions on all matters covered under any multilateral trade agreements.
• The WTO’s 12th Ministerial Conference was held in Geneva from 12-17 June.
• It was supposed to end on 15 June, but with intensifying negotiations, the conference was extended by two days. 

4. Key takeaways from the meeting

4.1 Curtailing harmful fishing subsidies

• The WTO passed a multilateral agreement that would curb ‘harmful’ subsidies on illegal, unreported, and unregulated fishing for the next four years, to better protect global fish stocks.
• Since 2001, member states have been negotiating the banning of subsidies that promote overfishing.
• The current agreement, which establishes new trading rules, is the second multilateral agreement in WTO history. 
• India and other developing countries were able to win some concessions in this agreement.

4.2 Global food security

• Members agreed to a binding decision to exempt food purchased by the UN's World Food Programme (WFP) for humanitarian purposes, from any export restrictions.
• In light of the global food shortages and rising prices caused by the war between Ukraine and Russia, the group's members issued a declaration on the importance of trade in global food security and that they would avoid bans on food exports.
• However, countries would be allowed to restrict food supplies to ensure domestic food security needs.
• India's key demand to allow it to export food from its public stockholdings to other countries will reportedly be discussed in the next Ministerial Conference in 2023.

4.3 E-Commerce transactions

• Members agreed to continue the long-standing moratorium on customs duties on e-commerce transmissions.
• It will be continued until the subsequent Ministerial Conference or until March 31, 2024, depending on whichever comes first.

4.4 Covid-19 vaccine production

• WTO members agreed to temporarily waive intellectual property patents on Covid19 vaccines without the consent of the patent holder for 5 years so that they can more easily manufacture them domestically.
• The current agreement is a watered-down version of the original proposal made by India and South Africa in 2020.
• They had wanted broader intellectual property waivers on vaccines, treatments, and tests.
• Rich pharmaceutical companies had strongly opposed this, arguing that IPs do not restrict access to Covid vaccines and that the removal of patent protections gives researchers that quickly produced life-saving vaccines, a negative message. 
• The waiver agreed upon by the WTO was criticized by advocacy groups for being narrow in scope, as it did not cover all medical tools like diagnostics and treatments.

5. Significance of the Recent Agreements

• The fisheries agreement is of immense significance as it is the first time that members agreed with environmental sustainability at its heart.
• It will also help in the protection of the livelihoods of the 260 million people who depend directly or indirectly on marine fisheries. It is only the second multilateral agreement on global trade rules struck in its 27-year history.
• Second, the exemption of WFP's food from tariffs is vital for promoting global food security, especially in light of the global food shortages and rising prices caused by the war between Ukraine and Russia.
• Third, the temporary waiver will contribute to ongoing efforts to concentrate and diversify vaccine manufacturing capacity so that a crisis in one region does not leave others cut off.

6. Issues surrounding WTO