330 CHAPTER NiNE ■ InternatIonal Po lItI cal economy
implementing the Uruguay Round, serving as a forum for trade negotiations and pro
viding a venue for trade review, dispute settlement, and enforcement.
Two impor tant procedures were initiated in the WTO. First is the Trade Policy
Review Mechanism (TPRM), which conducts periodic surveillance of the trade prac
tices of member states. Under this procedure, there is a forum where states can question
each other about trade practices. Second is the Dispute Settlement Body, designed as an
authoritative panel to hear and settle trade disputes. With the authority to impose sanc
tions against violators, this body is more power ful than earlier GATT arrangements.
Getting global participation in the WTO has proved a painstaking task. China’s
accession to the WTO in 2001, after 15 years of negotiations, illustrates the long pro
cess and significant concessions that some countries must make to participate. WTO
rules require domestic legislation and clarification. China revised its laws to permit
foreign ventures in previously restricted areas, leading to a significant inflow of foreign
investment in telecommunications, tourism, insurance, and banking. China contin
ues to dismantle barriers to trade, relaxing tariffs and quotas. Special domestic courts
hear WTO related disputes. China is now proactive in the WTO itself. The country is
a regular party to disputes, having acted as a complainant in 12 cases, a respondent in
33, and a third party in 116 as of early 2015, even though it has lost a majority of the
cases. The difficulties have been enormous. Since China’s laws governing foreign invest
ment and joint ventures were rudimentary, its security markets were not prepared for
liberalization. China still lags on intellectual property rights issues, long a source of
contention. Vietnam, which joined the WTO in 2007, is undergoing some of the same
reforms. In 2012, Rus sia joined as well, following 18 years of contentious negotiations,
largely over industrial subsidies. In each case, disentangling the government from the
economy has proven to be a difficult task.
The WTO pro cess remains contentious, as illustrated by the Doha Round launched
in 2001. The negotiations ended in stalemate, pitting the United States and the EU
against emerging economies, such as India, Brazil, and China. The main sticking point
has been the liberalization of agricultural markets. Neither the United States nor the EU
was willing to reduce farm subsidies significantly, which would have made agricultural
products from developing countries more competitive in international markets. India
and China, in par tic u lar, sought, if not an end to farm subsidies, then special safeguard
mechanisms for their own poor farmers to ensure food security. Many blamed the WTO’s
director general Roberto Azavedo for not exercising more leadership to iron out dis
agreements. More generally, however, the Doha Round failed over the perception of
fairness in trade. Already dissatisfied with new rules that opened competition in invest
ment and government procurement, the developing countries sought more advantages
in the po liti cally sensitive areas of agriculture and other labor intensive sectors.
In 2013 and 2014, negotiators fi nally broke the impasse. India and the United States
agreed that India and other developing countries would not incur penalties for imposing