WTO was established 52 years ago with only 23 members mainly from industrial nations. Gradually, the significance of the trade exchanges between nations prompted others to turn to WTO, then called GATT (General Agreement on Tariff and Trade). Finally in 1994, after the Uruguay Round, GATT was replaced by WTO with 134 members. The organization now controls over 90% of the world trade and intends to start implementing its Charter this year. The WTO Charter emphasizes on promotion of living standers in the member countries, providing full employment for their people, increasing their real income, effective exploitation of resources and development of trade and production.
It was 46 years ago, when for the first time, the country’s officials raised the issue of Iran’s membership in WTO. And now predictions on whether Iran would succeed to implement WTO terms in order to be accepted as a member, are very mixed, but most expert views stress on the necessity for Iran to seek WTO membership. On the importance of this issue in the eyes of Iranian officials in the past 40 years ago, let’s review events in this period:
In January 1959, for the first time the Iranian government announced that it has set up a committee to study Iran’s membership in GATT. In May 1959, the ad hoc committee announced the results of its research, emphasizing on the benefits which GATT membership might have had for Iran. The government committed itself to submit a motion to the Parliament, but the issue was forgotten. Another committee was then set up in the Foreign Ministry to study the same issue and, at the same time, Iran participated as observer in the GATT international summit. Iranian delegation reported upon its return that “the benefits of Iran’s membership in GATT are more than its harms for the country; therefore, it is advisable for Iran to join the international body.” However, the membership issue was forgotten again, until 1963 when the general conference of GATT was held in Geneva and Iran also took part in it as observer.
After 10 years, in 1974 Iranian minister of commerce participated in Tokyo summit heading a high-ranking delegation after which Iran tried to pave the way for its membership in GATT. After the Islamic Revolution the issue was raised again and Iranian envoys met with WTO officials and conveyed to them Iran’s interest in becoming a member of that organization.
Whether Iran should join WTO or not, is an obsolete discussion, because if Iran fails to adapt itself to the governing rules in the international market, it would certainly be eliminated by the competition, thus membership is an imperative for this country and is not a matter of choosing, economic experts believe.

No doubt there are lots of reasons for Iran to join WTO:
­ Permanent and secure access to international markets, based on Most-Favored Nation Treatment (MFN)
­ Immunity from being subject to discrimination in trade
­ Trade development in the domestic arena and exploiting the achievements of trade liberalization gained in the past 50 years
­ Protecting the country’s trade from covert and unseen non-tariff restrictions based on transparent trade regulations of WTO
­ Dissolving trade differences and trampled rights based on GATT rules and regulations
­ Finding a loophole against domestic resistance to economic reforms and structural adjustments
­ Enjoying WTO technical consultations

In order to join the WTO, a country should offer its request to WTO Secretariat and the application would be discussed by the General Council. A working group, of 10 to 15 countries or more of the country’s trade partners, would be set up. The working group comprises of 5-10, or more, member mostly from the applying country’s trade partners. Next step is offering a country report on the trade regime, and next is answering the questions posed by WTO. The answers would be a basis for the discussion at the first working group session. During the session many questions are raised about the trade policies, regulations, tariffs and economic performance of the applying country for which precise answers should be given.
If there is any ambiguity in answers a fact-finding delegation would be set up.
During various stages of applying for WTO membership the Secretariat would render assistance to newcomers. This includes organizing educational seminars through which new members are acquainted with agreements, the way necessary forms must be filled out and country reports must be prepared. After the above step the draft of the working group report named accession protocols is offered to general council the report includes basic information obligations and reduction of tariffs by the applying country once the report is approved the applying country becomes a WTO member and is obliged to implement all its agreements. The country also must inform other WTO members of the measures it takes in relation to WTO trade regulations based on disclosure principal. The privileges granted to new WTO members including developing and in transition economies are based on accession negotiations, i.e. those privileges are not necessarily mentioned in GATT agreements.
The terms for the countries which join WTO in 2000, would be quite different from those in 1994, because the deadline set for implementation of some agreements has already reached. These differences are mainly in granted privileges, deadlines for reduction of tariff and non-tariff measures.

Obstacles in the way of Iran’s membership in WTO:
The Islamic Republic of Iran officially submitted its application to join WTO in 1996 to the organization’s secretariat. Iran is now in the waiting list of accession to the WTO. But the fact is that the country’s application has not been placed on the agenda of the General Council yet, thanks mainly to the opposition by a certain member, only due to political reasons. This is against the stipulation in the General Agreement that the approval of the two-thirds of members is enough for a new membership. However, the organization insists on “consensus” for approving membership applications.
That’s why the Tai minister of commerce and the future director-general of WTO, is of the opinion that political influence in the organization should be kept at minimum.

It addition to the above political barrier, the Islamic Republic of Iran faces some problems in the domestic scene which hinders its WTO membership. The problem mostly lies with non-tariff restrictions and not tariffs.
These non-tariff restrictions include obtaining license for export and import activities, various customs regulations, legal prohibitions and applying personal and organizations tastes. This is while, based on the principle of trade activity disclosure, countries have to refrain from above issues. If they continue to practice them covertly, they would be uncovered through Trade Policy Review Mechanisms and the offending country would be subject to fine and objection by WTO.
Reaching agreement on tariffs at the negotiating table is quite easier than the elimination of non-tariff restrictions, because tariff rates are often low in the country and, therefore, the Islamic Republic government should pay special attention to elimination of non-tariff restrictions in trade exchanges.
In any case, involvement in the multi-faceted international economic needs a comprehensive look a the development at macro and micro levels, setting priorities in manufacturing activities, investment policies and technology transfer, financial and monetary, particularly foreign exchange, policies.
Implementation of WTO agreements is not limited to trade only; but the global trade relates to all economic sectors such as industrial, financial, agriculture, services and all macro-economic policies of the country in which significant changes should take place.
Fortunately, signs of change can be seen in Iran’s trade structures. The government has planned to achieve a $41 billion in revenue from the export of non-oil commodities, marking a big stride forward in the country’s exports. This would mean a $8.2 billion income in foreign exchange which is 2.5 times more than the income achieved in the 2nd Economic Plan, said President Mohammad Khatami when he submitted the 3rd Economic Plan to the Parliament. He also stressed that in order to realize a booming export, the government tries to eliminate non-tariff barriers or to change them in order to have clear and rational tariffs and remove the legal and executive restrictions.
Realization of a real boom in export necessitates a fundamental change in the economic administration and the decision-making system of the country. In decision-makings, the proposed policies should be based on scientific research and the involvement of economic agents, including manufactures, exporters and economic officials, while the control-oriented systems should change to a system based on trust. Moreover, all polices should be directed toward the export boom and a new generation of exporters should be trained who are familiar with e-commerce.
Information networks at national and intentional levels are good means for dissemination of data regarding the trade activities. Fortunately, such networks have been designed by the government and would be launched in two years.
Another obstacle for Iran to joint WTO is that officials in various sectors are not aware of the rules and regulations of WTO and lack negotiation skills. As officials themselves have admitted this fact in their interviews with the press. The only way to solve this problem is to make use of the experience of other countries, organizing seminars and educational courses where such experience can be exchanged between participants and training trade negotiators for this purpose.
Under such circumstances prospects for Iran’s membership in WTO is not very bright in short-term for two main reasons: First, the organization is to focus on the agenda which was decided in Seattle summit through the next three years. The Islamic Republic of Iran should concentrate its efforts to raise the issue of its membership in the next WTO summit in 2003. Evidence shows the qualifications needed for WTO membership would be much stricter in the future. Second, a major part of privileges set for developing courtiers in the GATT agreements would end in 2000; therefore, even if Iran succeeds to enter WTO, it would lose part of these privileges.
A significant issue in Iran’s joining the WTO are terms under which the accession protocol is prepared. If Iran succeed to get more privileges from the organization, the national interests would be more secured.

Iran Strategies to Enter World Trade:

Iran is a country enjoying an outstanding geographical situation, natural resources and young human force. It has long borders with open seas in the south and is considered as a significant transit route. Relying on these advantages, Iran should endeavor to make use of its unique geopolitical conditions and its potential as a transit route for goods, services and passengers. Though using its influence, it can facilitate regional trade and use this benefit to foster its status in the region. This necessitates integration into the global trade system, while establishing close cooperation with neighboring countries.
It is also advisable for the country to prepare its economy for “globalization of markets” through which it can be immune from losses and gain more benefits in economic development process. Entering the markets of neighboring countries could be the first step toward entering the international market where competition is very intense.