Question

Thoroughly evaluate the GATT/WTO process since its inception in 1947. Make sure you include the major accomplishments of each round (foregoing those in the 1950s). State briefly why each of these provisions was essential to moving the free trade process forward and ensuring fair treatment of products.

Answer 1

The great depression was a world wide depression which took place in the 1930. The depression originated from the US and trickled to the world. The depression was severe seeing a fall of approximately 10000 banks in just one year. The outstanding debt became heavier, prices fell and income also fell. Due to this fall, the countries decided to go for protectionist policies, the major example to which was Smooth Hawley Tariff Act, 1930, supported by rising tariffs in US. This generated a triff war and followed by the world war 2

To work on the damage done by the world war, the countires understood the demerits of protectionist trade policies. Following the loss, a conferences called the Bretton woods conference was organised to regulate the monetary and financial order, internationaly. The conference was held on July 1-22, 1944 and establishment of bodies namely the IMF , IBRD later the World Bank and ITO(iNTERNATIONAL Trade Organisation).

By 1947 , ITO failed to live up to expectation majorly following the disapproval of US ( Hawana Charter), leaving world trade regulation  and rules hanging. , leaving other nations impatient. To address this Geneva Conference in 1947 was done putting forward the idea of a temprary multilateral agrement - GATT( General Agreement on Tariff and Trade) , signed by 23 nations on Oct. 30, 1947.

It lasted until the signature by 123 nations in Marrakesh on April 14, 1994 of the uruguay round agreement. , which established the WTO on Jan 1, 1995 towards the purpose of regulating trade.

The reason for WTO to replace GATT, because GATT was limited to trading of merchandised goods.( WHO covers intellectual rights and other services also). The structure of Gatt encouraged Red tapism , and took a lot more time than WTO because of lack of authority. Grand Bargain was a major step put forward by Developing nation's negotiations with developed nations.

This gives a brief summary about how the WTO got it's power. The negotiations continues still.