What can you say about THE GATT?

TOPIC : The General Agreements on Tariffs and Trade (GATT)

What is GATT?

 -Was a legal agreement minimizing barriers to international trade by eliminating or reducing quotas, tariffs, and subsidies while preserving significant regulations. The GATT was intended to boost economic recovery after the World War II through reconstructing and liberalizing global trade.

? Began in 1947 with 23 members

? Location: Geneva

? Purpose:"Substantial reductions of Tariffs and other Trade Barriers and elimination of preferences, on reciprocal and mutually advantageous basis"

The Role of GATT

? GATT sponsored rounds

? GATT as monitor

? Most favorable NATION Clause (MFN)

? Lack of legal status

OBJECTIVES OF GATT

? To provide equal opportunities to all countries in international market trading.

? To increase the effective demand for real income growth and goods.

? To minimize tariffs on trade for ensuring mutual benefit.

? To provide proper solution to the disputes related to international trade.

? To ensure a better living standards in the world as a whole.

In my personal opinion, GATT helped a lot of countries in rebuilding their economies after the terrible World War II. It gave equal opportunities to all members especially to small and poor countries. It encouraged nations to increase the demand of their products and to trade internationally. It promotes mutual gain from every nation under the agreement and remove discrimination. In addition, GATT reduced and terminated some of the trade barriers including quotas and trade controls that hinders the smooth transaction and exchange of trades. It also improve the quality of negotiations and handling disputes between nations because it is more systematized. When the time GATT was signed, the tariff rate is around 20% above. However, the rate decreased to around 5% during the last years of the agreement.

Step-by-step explanation

Although GATT is terminated, it was replaced by the new and improved agreement known as WTO or World Trade Organization. WTO contains the best features from GATT with some additions and revisions to tackle certain issues regarding globalization. It is really necessary because the main goal of GATT is to help the countries recover after the war. But, many years have passed and the world economy has already stabilized. It is appropriate to change the agreement and match it from the current issues of the world. The creation of GATT really gave benefits to the nations after the war. It just not improve the economic status of the world but it also develop fairness, remove discrimination and build good relationship among different countries.