2. What is the WTO? The World Trade Organization (WTO) is the
only global international organization dealing with the rules of
trade between nations. MAIN FUNCTION : to ensure that trade flows
as smoothly, predictably and freely as possible. GOAL : to help
producers of goods and services, exporters, and importers conduct
their business.
3. ABOUT W.T.O. Location : Geneva,Switzerland Established :
1January1995 Created by : Uruguay Round negotiations (1986-94)
Membership : 153 countries on 10February2011 Budget : 196million
Swiss francs for2011 Head : Pascal Lamy (Director-General)
Functions: Administering WTO trade agreements Forum for trade
negotiations Handling trade disputes Monitoring national trade
policies Technical assistance and training for developing countries
Co-operation with other international organizations
4. Working of W.T.O. The WTO is run by its member governments.
All major decisions are made by the membership as a whole, either
by ministers or by their ambassadors or delegates. Trade
negotiations : The WTO agreements cover goods, services and
intellectual property. They spell out the principles of
liberalization, and the permitted exceptions. Implementation and
monitoring : WTO agreements require governments to make their trade
policies transparent by notifying the WTO about laws in force and
measures adopted.
5. Dispute settlement : The WTOs procedure for resolving trade
quarrels under the Dispute Settlement Understanding is vital for
enforcing the rules and therefore for ensuring that trade flows
smoothly. Building trade capacity : WTO agreements contain special
provision for developing countries, including longer time periods
to implement agreements and commitments, measures to increase their
trading opportunities, and support to help them build their trade
capacity Outreach : The WTO maintains regular dialogue withNGOs,
parliamentarians, the media and the general public on with the aim
of enhancing cooperation and increasing awareness of WTO
activities.
6. Following is the structure of WTO. Highest Level:
Ministerial Conference The Ministerial Conference is the top most
body of the WTO, which meets in every two years. It brings together
all the members of WTO. Second Level: General Council The General
Counsel of the WTO is the highest level decision making body in
Geneva, which meets regularly to carry out the functions of WTO.
Third Level: Councils for Trade The Workings of GATT, which covers
international trade in goods, are the responsibility of the Council
of Trade. Fourth Level: Subsidiary Bodies There are subsidiary
bodies under the various councils dealing with specific subjects
such as agriculture, subsidies, market access etc.
7. Principles of W.T.O.
These following principles are the foundation of the
multilateral trading system:
Non-discrimination
More open
Predictable and transparent
More competitive
Discouraging unfair practices
More beneficial for less developed countries
Protect the environment
8. 10 Benefits of W.T.O. 1. The system helps promote peace 2.
Disputes are handled constructively 3. Rules make life easier for
all 4. Freer trade cuts the costs of living 5. It provides more
choice of products and qualities 6. Trade raises incomes 7. Trade
stimulates economic growth 8. The basic principles make life more
efficient 9. Governments are shielded from lobbying 10. The system
encourages good government
9. INDIA and W.T.O. India has been a WTO member since
1January1995 .
10. INDIA and W.T.O.
India is one of the founding members of WTO along with 134
other countries.
India's participation in an increasingly rule based system in
governance of International trade, would ultimately lead to better
prosperity for the nation.
Various trade disputes of India with other nations have been
settled through WTO.
India has also played an important part in the effective
formulation of major trade policies.
11. Effect on India
In total world imports of goods and commercial services during
the same period, the country's share has increased to 0.99 per cent
from 0.78 per cent.
By being a WTO member, India also avails of the Most Favoured
Nation (MFN) treatment and National Treatment for its exports to
other WTO members.
In addition, the size of quotas was expanded annually by the
restraining countries that maintained the quota.
With effect from January 2005, the entire textiles
and clothing trade would get integrated into
multilateral framework of the WTO
12. Trade Profiles W.T.O.
13. Trade Profiles W.T.O. The Trade Profiles provide standard
information on the structural trade situation and trade policy
measures of members, observers and other selected economies. The
profiles are complemented with general macroeconomic indicators.
Data are currently provided for over 180 economies and coverage
will be gradually extended as information becomes available.
14. Indias Trade Profile
15. International Monetary Fund
16.
IMF is the intergovernmental organization that oversees the
global financial system by following the macroeconomic policies of
its member countries, in particular those with an impact on
exchange rate and the balance of payments.
IMF is a forum of national economic policies, international
monetary and financial systems, which involves active dialogue with
each member country.
As of end-August 2009, IMF's total quotas stood at SDR 217.4
billion (about $325 billion).
Five largest shareholders:United States, Japan, Germany,
France, United Kingdom.
International Monetary Fund
17.
The IMF was created to support orderly international currency
exchanges and to help nations having balance of payment problems
through short term loans of cash.
Its headquarters are in Washington, United States.
International Monetary Fund
18.
The International Monetary Fund was conceived in July 1944
originally with 45 members and came into existence in December 1945
when 29 countries signed the agreement
IMF started to make service with IBRD in 1947.
The IMF works to improve the economies of its member
countries
HISTORY
19. Organization
20.
Promote international monetary cooperation.
Expansion and balanced growth of international trade.
Promote exchange rate stability.
The elimination of restrictions on the international flow of
capital.
Help establish multilateral system of payments and eliminate
foreign exchange restrictions.
Purposes of the IMF
21.
Make resources of the Fund available to members
Shorten the duration and lessen the degree of disequilibrium in
international balances of payments
Promote international monetary cooperation, exchange stability,
and orderly exchange arrangements.
Foster economic growth and high levels of employment.
Temporary financial assistance to countries to help the balance
of payments adjustments
22. Growth in IMF Membership
In the beginning 29 member countries
Today,187 member Countries
Staff of about 2680 Persons
23. IMF PROJECTIONS
24.
25.
Focusing on its core macroeconomic and financial areas of
responsibility.
Working in a complementary fashion with other institutions
established.
Collection and allocation of reserves. Rendering advice to
member countries on their international monetary affairs.
Promoting research in various areas of international economics
and monetary economics.
Providing a forum for discussion and consultation among member
countries. Being in the center of competence.
ROLE OF IMF
26.
Surveillance (like a doctor) Gathering data and assessing
economic policies of countries.
Technical Assistance (like a teacher) Strengthening human
skills and institutional capacity of countries.
Financial Assistance (like a banker) Lending to countries to
support reforms
FUNCTIONS OF IMF
27.
Monitoring economic and financial developments and policies, in
member countries and at the global level, giving policy advance to
its members based on its more than fifty years of experience.
Lending to member countries with balance of payments problems,
supporting adjustment and reform policies aimed at correcting the
underlying problems.
Providing the governments and central banks of its member
countries with technical assistance and training in its areas of
expertise.
Operations
28.
IMF looks at the performance of the economy as a whole
(macroeconomic performance)
Focuses also on the financial sector policies Ex: regulation
and supervision of banks and other financial institutions.
Pays attention to structural policies that affect macroeconomic
performance.
Ex: labor market policies (affect employment and wage
behavior)
Contd
29.
The Executive Board meets three times a week, maybe more
The Board has a voting system:- The larger the economy, the
more voting power it has
But, most decisions are based on consensus
How the polices are determined:
30.
Most loans are provided by member countries, determined by
their quota, which is calculated based upon a countrys relative
size in the world economy.
For a closer look at the Member Quotas we can reference the IMF
website.
Upon joining, the 25% of the quota is paid in some major
currency US Dollar, British Pound, Yen while the remaining 75% is
paid in their own currency.
Where does the IMF get its Money from?
31.
IMF can only borrow from financially strong economies to
finance lending.
The IMF Board selects these strong currencies every three
months, which make up its usable resources.
What is the IMFs Lending Capacity?
32.
India and the IMF has a positive relationship. The IMF has
provided financial assistance to India, which has helped in
boosting the country's economy.
The IMF praised the country for it was able to avoid the Asian
Financial Crisis in 1999 and was also able to maintain the average
rate of growth of its economy.
In 2005, the IMF said that the budget of India is very positive
for it points that the economy of the country will grow at the rate
of 6.7%.
India and the IMF
33.
The Managing Director of International Monetary Fund Rodrigo De
Rato visited India in May 2005.
International Monetary Fund said that the reasons behind the
economy growth of India are that the RBI has been able to control
inflation and has also handled its monetary policies very
skillfully.
The IMF has suggested that India can become a financial super
power by bringing in more reforms in its economic policies that
will increase its growth rate to 8%.
Contd
34.
The IMF collaborates with
the World Bank,
the regional development banks,
the World Trade Organization,
United Nations agencies, and
other international bodies.
Collaborating with Other Institutions
35.
Monitoring national, global, and regional economic and
financial developments and advising member countries on their
economic policies (surveillance)
Lending members hard currencies to support policy programs
designed to correct balance of payments problems
Offering technical assistance in its areas of expertise, as
well as training for government and central bank officials
How does the IMF serve its member countries?
36.
The SDR, or Special Drawing Right s , is an international
reserve asset that member countries can add to their foreign
currency and gold reserves and use for payments requiring foreign
exchange.
Its value is set daily using a basket of four major currencies:
the euro, Japanese yen, pound sterling, and U.S. dollar.
The IMF introduced the SDR in 1969 because of concern that the
stock and prospective growth of international reserves might not be
sufficient to support the expansion of world trade. (The main
reserve assets at the time were gold and U.S. dollars.)
What is the SDR?
37.
The SDR was introduced as a supplementary reserve asset, which
the IMF could "allocate" periodically to members when the need
arose, and cancel, as necessary.
IMF member countries may use SDRs in transactions among
themselves, with 16 "institutional" holders of SDRs, and with the
IMF.
The SDR is also the IMF's unit of account. A number of other
international and regional organizations and international
conventions use it as a unit of account, or as the basis for a unit
of account.
Contd
38.
Most comes from the quota subscriptions
the money each member contributes when joining the IMF
General Arrangements to Borrow (1962)
line of credit set up with several governments and banks
throughout the world
Where the IMF gets its money
39.
A country that had not taken in enough foreign currency to pay
the other countries for what they have bought
spends more money than it takes in
IMF will lend foreign exchange to that member
hoping to stabilize its currency which will strengthen its
trade
When is a country in need ?
40.
Most of the IMF's loans to low-income countries are made on
concessional terms, under the Poverty Reduction and Growth Facility
.
Under a mechanism introduced by the IMF in 2005the Policy
Support Instrument countries can request that the IMF regularly and
frequently review their economic programs to ensure that they are
on track.
How Does the IMF help Poor Countries?
41.
The success of a country's program is assessed against the
goals set forth in the country's poverty reduction strategy , and
the IMF's assessment can be made public if the country wishes.
The IMF also participates in debt relief efforts for poor
countries that are unable to reduce their debt to a sustainable
level even after benefiting from aid, concessional loans, and the
pursuit of sound policies.
To ensure that developing countries reap full benefit from the
loans and debt relief they receive, in 1999 the IMF and the World
Bank introduced a process known as the Poverty Reduction Strategy
Paper (PRSP) process.
Contd
42.
25% of the countrys quota may be used
If this is not sufficient, then members can borrow up to 3
times the amount of its quota
present plans for reform to Executive Directors
If these plans are sufficient for the Executive Directors, the
IMF grants the member a loan
How much money a member can borrow from the imf ?
43. On the Agenda - Key Issues that The IMF is grappling with
A partner in Europe
Reinforcing multilateralism
Rethinking macroeconomic principles
Stepping up crisis lending
Strengthening the international monetary system
Supporting low-income countries
44.
The IMF works to foster global growth and economic stability.
It provides policy advice and financing to members in economic
difficulties and also works with developing nations to help them
achieve macroeconomic stability and reduce poverty.
