World Trade Organization (WTO) and SAFTA
World Trade Organization (WTO):
World Trade Organization is one of the special organization of the United Nations. It is the modern form of GATT (General Agreement on Trade and Tariffs). It was established on 1 January 1995. The headquarter of WTO is located at Geneva Switzerland. Nepal is the 147th member of WTO. In the year 2003, Nepal received the membership of WTO.
Objectives of WTO:
The main objectives of WTO are as follows:
- To solve trade conflicts between member nations.
- To simplify and reduce custom duties and other trade barriers among member nations.
- To achieve sustainable economic development in each member nation.
- To promote and preserve environmental resources in scientific way.
- To promote the production and trade of goods and services.
Principles of WTO:
- Binding and enforceable commitments
- Safety values
South Asian Free Trade Area (SAFTA):
The South Asian Free Trade Area was established by the SAARC member countries for the development of regional trade and cooperation in the South Asian region. The concept of SAFTA was introduced in the 11th SAARC summit held in Kathmandu. Final agreement to implement SAFTA was made in the 12th SAARC summit held in Pakistan. SAFTA came into existence since 1 January 2006.
Objectives of SAFTA:
- To promote fair competition in the free trade area.
- To eliminate barriers of trade among member nations.
- To create effective mechanism for implementation of trade agreement.
- To establish a framework for further regional cooperation.
Principles of SAFTA:
- SAFTA will be governed by rules, regulation, decisions, understanding, and protocols.
- The contracting states affirm their existing rights and obligations.
- SAFTA shall be based and applied on the principle of overall reciprocity and mutual advantages.
- SAFTA shall involve in free movement of goods.