ACCESSION TO THE WTO: BENEFITS AND CHALLENGES

Acceding to the World Trade Organization (WTO) as a full-fledged member is key in integrating beneficially into the international trading system and the global economy.

BENEFITS

Accession is a policy decision to enter into the discipline of a rules-based, open and integrated trading system; it can impact a large number of areas of the economy. Being a WTO Member, or aspiring to be one, sends a clear signal to trade partners and investors about a country's commitment to an open economy, which encourages the increase in trade and inflow of foreign investment and technological know-how and lifts productivity.

By committing to a maximum level of tariff protection and eliminating quotas on imports, as required by the WTO, countries create a predictable and transparent framework which improves the business environment and promotes good governance. Similarly, the establishment of simplified rules on licensing, registration, and customs clearance can have a very positive effect on business. Becoming a member of the WTO brings greater security and predictability of access to the markets of other WTO Members, as well as protection for the private sector against harmful trade actions by other countries.

Undertaking the many obligations of WTO membership can also help strengthen a country’s trade-related institutions and streamline regulatory and institutional policies that can lead to significant reforms across law, and commerce.

Last but not least, accession also allows new Members the opportunity to safeguard their interests by participating actively in international trade negotiations and international rule-making.

CHALLENGES

While the benefits of acceding to the WTO are many, various challenges stem from the accession process itself: it is a long and complex negotiation process, involving wide-ranging legislative and executive actions by acceding countries, that requires extensive human resources and institutional capacities, including sectoral expertise. Many countries that request to accede face particular constraints throughout this process, such as a limited analytical capacity to support trade and impact analysis and/or a lack of resources to respond to information requests among other limitations.

Accession carries a number of obligations, including adjustment following the opening up of sectors of the economy to competition from other WTO Members as well as acceptance of procedures for the regulation of the services sector. Thus, implementation also poses challenges that have to be faced both by government and the private sector.

WHAT IS THE WTO ACCESSION PROCESS?

Any state or customs territory having full autonomy in the conduct of its trade policies may become a member (“accede to”) of the WTO, but all WTO members must agree on the terms. This is done through the establishment of a working party of WTO members and through a process of negotiations. Following the establishment of a working party for the accession process, bilateral, plurilateral and multilateral negotiations take place in parallel. The successful conclusion of these negotiations leads to the drafting of an accession package (“terms of accession/entry”), which needs to be adopted by the accession working party and approved by the WTO's General Council or Ministerial Conference. Subsequently, the acceding government has to accept the “terms of entry” — either through signature or ratification — and becomes a full-fledged WTO member 30 days after it notifies the acceptance of its Protocol of Accession to the WTO Director-General.

All information on the WTO accession process can be found here

Current status of ongoing accession negotiations can be found here

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