What Is World Trade Organization and Its History?

The World Trade Organization (WTO) is an international organization that deals with the rules of trade between nations. The WTO was established on January 1, 1995, following the Uruguay Round negotiations, which lasted from 1986 to 1994. The WTO replaced the General Agreement on Tariffs and Trade (GATT), which was established after World War II to regulate international trade.

History of the World Trade Organization

The idea for a world trade organization was first proposed in the late 1940s during the negotiations that led to the formation of GATT. However, it was not until the mid-1980s that serious discussions began about replacing GATT with a more comprehensive organization. In September 1986, ministers from over 100 countries met in Punta del Este, Uruguay, to launch what would become known as the Uruguay Round of trade negotiations.

Over seven years of negotiations followed, during which time GATT’s member countries agreed to reduce tariffs and other trade barriers. They also discussed new rules for areas such as services and intellectual property rights. Finally, in April 1994, ministers from all GATT member countries met in Marrakesh, Morocco to sign a new agreement establishing the World Trade Organization.

The Functions of the World Trade Organization

The main function of the WTO is to ensure that trade flows as smoothly and freely as possible between its member countries. This is achieved by setting and enforcing rules for international trade. The WTO also provides a forum for negotiating new agreements between its members in areas such as agriculture and intellectual property.

One of the most important functions of the WTO is its dispute settlement mechanism. If one country believes that another country is violating its WTO obligations, it can bring a complaint to a WTO panel.

The panel will then investigate and make recommendations for resolving the dispute. If either party is dissatisfied with the panel’s decision, they can appeal to the WTO’s Appellate Body.

The Structure of the World Trade Organization

The WTO is a member-driven organization. All major decisions are made by its member countries, with each country having one vote.

The highest decision-making body is the Ministerial Conference, which meets at least once every two years. In between Ministerial Conferences, the General Council oversees the day-to-day work of the WTO.

The WTO Secretariat, based in Geneva, Switzerland, provides administrative support to the organization. The Director-General of the WTO is responsible for overseeing the work of the Secretariat and promoting the organization’s objectives.


The World Trade Organization plays a crucial role in regulating international trade and promoting economic growth. By setting and enforcing rules for trade between its member countries, it helps to ensure that goods and services can flow freely across borders. While it has faced criticism from some quarters for its perceived lack of transparency and its impact on developing countries, it remains an important institution in today’s globalized world.