What is the function of the World Trade Organization (WTO)?

The World Trade Organization (WTO) plays a critical role in regulating international trade and resolving trade disputes between nations. It was created to establish a framework for negotiating trade agreements and a mechanism for enforcing them, thereby fostering a more stable and predictable trading environment.

The WTO helps member countries navigate complex trade relations by providing a platform for them to voice their concerns about trade practices, as well as to challenge unfair trade measures. It aims to reduce trade barriers, which can lead to more efficient global trade and increased economic growth. By facilitating negotiations and offering a dispute resolution process, the WTO ensures that trade flows as smoothly and predictably as possible, which is vital for global economic stability.

In contrast, the other functions listed are not part of the WTO's mandate. Providing loans to developing countries is primarily the role of institutions like the World Bank. Promoting domestic production is a goal of national policies rather than an international regulatory body. Likewise, while environmental standards can be a subject of trade discussions, setting global standards in this area falls outside the primary scope of the WTO's responsibilities. Therefore, the correct function attributed to the WTO is its regulatory role in international trade and the resolution of trade disputes.