Explain what the WTO is, its purpose and how matters can be resolved with the assistance of WTO Dispute Settlement Body.

In Week 5, you were tasked with creating a treaty on trade with a neighboring country’s ambassador. Unfortunately, that country has breached your trade agreement. Both your state and the neighboring country are members of the World Trade Organization (WTO). You have decided to bring the matter before the World Trade Organization Dispute Settlement Body. In your post this week, please answer the following questions:

1) Explain what the WTO is, its purpose and how matters can be resolved with the assistance of WTO Dispute Settlement Body.

2) What procedures are available to resolve your dispute?

3) What do you foresee happening in resolution of the conflict with your neighboring country?

Answer & Explanation
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The World Trade Organization (WTO) is an international organization that aims to promote free trade and reduce barriers to international commerce. It was established in 1995 as a successor to the General Agreement on Tariffs and Trade (GATT) and currently has 164 member countries.

The purpose of the WTO is to ensure that trade flows as smoothly, predictably, and freely as possible. It accomplishes this by setting and enforcing rules for international trade, providing a platform for negotiation and cooperation among member countries, and resolving trade disputes between member countries through its dispute settlement system.


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Step-by-step explanation
WTO’s dispute settlement process involves several stages. When a member country believes that another member country has violated WTO rules, it can request consultations with the other country to try to resolve the dispute. If consultations do not resolve the issue, the complaining country can request the establishment of a dispute settlement panel to hear the case.

The panel will review the evidence and arguments presented by both sides and issue a report with its findings and recommendations. If either party disagrees with the panel’s findings, they can appeal the decision to the WTO’s Appellate Body. The Appellate Body will review the panel’s report and issue a final decision.

If the Appellate Body upholds the panel’s findings, the losing country is expected to bring its trade practices into compliance with WTO rules. If it fails to do so, the winning country may be authorized to impose trade sanctions against the losing country until it comes into compliance.

Overall, the WTO’s dispute settlement system is designed to encourage member countries to resolve trade disputes through negotiation and consultation, but also provides a robust mechanism for resolving disputes when necessary to ensure that WTO rules are followed and free trade is maintained.

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