WTO Members: Categories and Benefits

3 Reasons Why WTO Membership Is So Important

WTO Bali Agreement
We did it! said Indonesia's Trade Minister Gita Wirjawan, hugging WTO Director-General Roberto Azevdo as the Bali negotiation was concluded. Photo: WTO/Ankara

There are 164 members of the World Trade Organization. That's 84 percent of the 196 countries in the world. They joined to enjoy the benefits of greater international trade conferred by the WTO.

WTO Membership Benefits

The WTO helps trade throughout the world flow smoothly through its trade agreements. Members of the WTO know what the rules are. They understand the penalties for breaking the rules and how to play the global trade game, which certainty creates a safer trading arena for everyone.

The WTO also provides its members with a fair method to resolve trade disputes. They don't have to resort to violence or war. For more, see How Does the WTO Resolve Trade Disputes?

The WTO negotiates improved trade arrangements among its members. Its most recent round of negotiations took place in Bali. The largest agreement would have been the Doha Round of Trade Talks. It failed because the United States and Europe were not willing to reduce agricultural subsidies.

Membership also lowers the costs of doing business by removing volatility. These general benefits extend to all members. 

Three Specific Benefits

The WTO confers three specific benefits to all its members, which enable the general benefits mentioned earlier.

First, the WTO grants each member Most Favored Nation status, which means that WTO members must treat each other the same. They give no preferential trade benefit to any one member without giving it to all.

Second, WTO members have lower trade barriers with each other. That includes tariffs, import quotas, and regulations. Lower trade barriers allow members larger markets for their goods, which leads to greater sales, more jobs, and faster economic growth.

Third, around two-thirds of WTO members are developing countries.

Their membership gives them immediate access to developed markets at the lower tariff rate, which gives them time to catch up with sophisticated corporations and their mature industries. They don't have to remove reciprocal tariffs in their markets until later. That means developing countries don't have to immediately open their markets to overwhelming competitive pressure. 

Along these lines, there are 36 WTO members that are least-developed countries (LDCs). The United Nations grants that status to low-income countries with severe blocks to sustainable economic growth. The UN and other agencies provide them extra assistance in development and trade. (Source: "Least Developed Countries," United Nations.)

Responsibilities

Membership in the WTO also comes with responsibilities. Members agree to avoid trade barriers and abide by the WTO's resolution of any dispute. That prevents retaliatory trade warfare. These escalating trade restrictions help individual countries in the short term but hurt world trade in the long term. In fact, it was just this type of trade protectionism that worsened the Great Depression of 1929. As global trade slowed, countries sought to protect domestic industries.

They erected trade barriers, creating a downward spiral. As a result, world trade shrank by 25 percent.

WTO Members by Category

The WTO has 76 founding members. They started the organization on January 1, 1995.

Asia has six LDC members. They are Afghanistan, Bangladesh, Cambodia, Laos, Myanmar, and Nepal. Its founding members are Bahrain, Bangladesh, Brunei, Hong Kong, India, Indonesia, Japan, Korea, Kuwait, Macao, Malaysia, Myanmar, Pakistan, Philippines, Singapore, and Thailand.

Its other members are Armenia, China, Georgia, Israel, Jordan, Kazakhstan, Kyrgyz Republic, Maldives, Mongolia, Oman, Papua New Guinea, Qatar, Russia, Samoa, Saudi Arabia, Sri Lanka, Taipei, Tajikistan,  Turkey, United Arab Emirates, Viet Nam, and Yemen.

Africa has the most members that are designated as least developed. They are Angola, Benin, Burkina Faso, Burundi, Central African Republic, Chad, Congo Democratic Republic, Djibouti, Gambia, Guinea, Guinea-Bissau, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nigeria, Rwanda, Senegal, Sierra Leone, Tanzania, Togo, and Uganda.

Its founding members are Cote d'Ivoire, Kenya, Mauritius, Morocco, Namibia, Senegal, South Africa, Swaziland, Tanzania, and Uganda.

Its other members are Botswana, Cameroon, Congo Republic, Egypt, Gabon, Ghana, Niger, Seychelles, Tunisia, Zambia, and Zimbabwe.

Europe has the most founding WTO members. Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Luxembourg, Malta, Netherlands, Norway, Portugal, Romania, Slovak Republic, Sweden, and the United Kingdom. In addition, the European Union is a founding member.

Its other members are Albania, Bulgaria, Croatia, Cyprus, Estonia, Latvia, Lichtenstein, Lithuania, Macedonia, Moldova, Montenegro, Poland, Slovenia, Spain, Switzerland, and Ukraine.

Central and North America have just one LDC member: Haiti. Its founding members are Antigua and Barbuda, Barbados, Belize, Canada, Costa Rica, Dominica, Honduras, Mexico, Saint Lucia, Saint Vincent and the Grenadines, and the United States.

Its other members are Cape Verde, Cuba, Dominican Republic, El Salvador, Grenada, Guatemala, Jamaica, Nicaragua, Panama, Saint Kitts and Nevis, and Trinidad and Tobago.

Oceana has two LDC countries: Solomon Islands and Vanuatu. Its founding member is Australia. The other three members are Fiji, New Zealand, and Tonga.

South America has no LDC members. Its founding members are Argentina, Brazil, Chile, Paraguay, Peru, Uruguay, and Venezuela. Its other members are Bolivia, Colombia, Ecuador, Guyana, and Suriname.

Prospective WTO Members 

The WTO has a category called Observer. These 20 countries have applied to become members. They have five years to complete the process (except for the Vatican). Find out more on How a Country Becomes a WTO Member.

The prospective members are Algeria, Andorra, Azerbaijan, Bahamas, Belarus, Bhutan, Bosnia and Herzegovina, Comoros, Equatorial Guinea, Ethiopia, Iran, Iraq, Lebanon, Libya, Sao Tome and Principe, Serbia, Sudan, Syria, Uzbekistan, and the Vatican.

Countries Outside the WTO

Twelve countries aren't members and haven't applied to become members. They are Eritrea, Kiribati, Marshall Islands, Micronesia, Monaco, Nauru, North Korea, Palau, San Marino, Somalia, South Sudan, Turkmenistan, and Tuvalu.