Question

Minimum 700 words Comment on the importance of GATT, WTO and arrangements such as the NAFTA in ensuring trade is fair in the international environment. Discuss the impact of such agreements in a chosen sector in Jamaica. The sector chosen must be clearly identified.

Answer 1

Answer:

The General Agreement on Tariffs and Trade (GATT) was formed in Geneva in 1947 taking January 1, 1948. The purpose of the GATT to eliminate trade quotas and to reduce the duties of tariffs. When GATT went into effect it was compromised of 23 countries and regulated trade between 152 countries

• GATT had three main provisions. The most important requirement was that each member must confer most favored nation status to every other member.
• All members must be treated equally when it comes to tariffs. It excluded the special tariffs among members of the British Commonwealth and customs unions. It permitted tariffs if their removal would cause serious injury to domestic producers.
• GATT major principal was trade without discrimination and for each member nation to open their markets equally to other member nations.
• GATT had provisions that once member nations agreed to reduce tariffs to another nation that that reduction was extended to all other member nations.
• Other articles presented under GATT were uniform customs regulations, and an obligation for each nation to each member nation to negotiate tariff reductions at the request of other member nations.
• Although the primary business of GATT was to negotiate tariff reduction, major trade conferences were held occasionally to work out tariff reductions and other issues that arose through global trading.
• Seven conferences have been held from 1947 to 1993, of those conferences three are the most important, The Kennedy round from 1964-1967, the Tokyo Round1873-1979 and the Uruguay Round 1986-1994.
• These three rounds succeeded in reducing the world’s tariffs from 40% in 1947 to less than 5% in 1993
• The most notable of the three rounds was the Uruguay Round held in Geneva. By the end of the conference, the GATT established a Worldwide
• Trade Treaty that cut the tariffs on industrial goods by 40%, reduced agricultural subsidies and established new agreements on trade services. At the end of the Uruguay Round, a stronger organization was formed to replace the GATT,
• The World Trade Organization (WTO), and many of the trade agreements and treaties created under GATT were succeeded into the WTO. In 1995 125 nations were part of the WTO and the WTO governs 90% of world trade
• In 2015 the WTO consisted of 161 countries, governing WTO trade agreements, the negation of trade disputes, and tariffs, monitoring national trade policies, providing training and assistance to developing countries and is intertwined with cooperation from other international organizations.
• Since 1994 there have been ten conferences to regulate world trade and to facilitate tariff negotiations. The WTO is being used by corporations to dismantle hard-won environmental protections, who call them barriers to trade
• The North American Free Trade Agreement (NAFTA) is one of the most powerful treaties in the world.
• It governs the entire spectrum of North American trade and has at its roots hemispheric cooperation on a scale never before seen.
• NAFTA is a treaty between Canada, Mexico, and the United States that was designed to develop greater trade between the three countries. NAFTA has been in effect since 1 January 1994.
• One important thing that NAFTA did right away was to eliminate a large number of tariffs on goods shipped between the three countries. American goods, mostly, were being sold to Canada and especially to Mexico and carried with them a high tariff. Mexico and Canada did not wish to pay the tariffs, so the goods were not sold in North America.
• As a result of NAFTA, Mexico especially has purchased goods from the US in much greater numbers than before. This saves Mexican companies money on imports, and it saves American companies money on export shipping costs. Canada has benefited in this way as well, although not nearly to the extent that Mexico has

The General Agreement on Tariffs and Trade (GATT): GATT bound 23 member countries (originally) to multilateral free trade agreement that later concluded into the Agreement Establishing the World Trade Organization. GATT’s objective was to eliminate or reduce the trade tariffs and other trade impediments on reciprocity and mutual advantage basis.

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