The World Trade Organization (WTO) and the General Agreement on Tariffs and Trade (GATT) serve similar purposes in promoting international trade and facilitating negotiations among member countries.
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However, there are distinctions in their functions, particularly regarding coverage:
- Coverage of GATT: GATT primarily focused on the reduction of tariffs and other trade barriers in goods. It aimed to liberalize trade by negotiating tariff concessions and agreements to reduce discriminatory practices such as quotas and subsidies. GATT primarily dealt with trade in goods and had limited provisions for services and intellectual property rights.
- Coverage of WTO: The WTO has a broader scope of coverage compared to GATT. In addition to trade in goods, the WTO addresses trade in services and intellectual property rights through separate agreements: the General Agreement on Trade in Services (GATS) and the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), respectively. These agreements extend the regulatory framework of the WTO beyond traditional goods-based trade to include services and knowledge-based goods.
- Function of GATT: GATT primarily functioned as a forum for negotiating trade agreements and resolving disputes related to trade in goods. Its main goal was to promote trade liberalization and foster economic growth by reducing barriers to the exchange of goods among member countries.
- Function of WTO: The WTO serves a broader range of functions compared to GATT. In addition to negotiating trade agreements, the WTO provides a forum for discussing trade-related issues, conducting trade policy reviews, and offering technical assistance and capacity-building support to member countries. Moreover, the WTO has a dispute settlement mechanism that facilitates the resolution of disputes among member countries.
Overall, while both GATT and the WTO aim to promote international trade and facilitate negotiations, the WTO’s coverage extends beyond goods to include services and intellectual property rights. This broader scope reflects the evolving nature of international trade and the need for comprehensive rules and agreements to govern various aspects of trade and economic activity.