Summary of General Agreement on Tariffs and Trade

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The General Agreement on Tariffs and Trade (GATT) was established in 1947 by 23 countries to promote international trade and reduce tariffs on goods. Over time, the agreement expanded to include more than 100 countries and became the World Trade Organization (WTO) in 1995. The main goal of the GATT/WTO has been to create a level playing field for trade between countries.

One of the key principles of the GATT/WTO is Most-Favored Nation (MFN) treatment, which requires countries to treat all other countries equally in terms of trade. This means that if a country grants a trade concession to one country, it must also grant that concession to all other countries. This principle helps prevent discrimination and protects smaller countries from being disadvantaged in trade.

Another principle of the GATT/WTO is the removal of trade barriers, such as tariffs and quotas, to promote free trade. The agreement aims to ensure that these barriers are reduced or eliminated, which can lead to increased trade and economic growth.

The GATT/WTO also aims to address non-tariff barriers, which include regulations, technical standards, and other measures that can impede trade. The agreement encourages countries to adopt international standards and to ensure that any regulations or measures are not discriminatory or overly restrictive.

In addition, the GATT/WTO has mechanisms in place to resolve trade disputes between countries. The dispute settlement process involves consultations, mediation, and ultimately the establishment of a panel to make a ruling. This process is designed to ensure that trade disputes are resolved fairly and efficiently.

Overall, the GATT/WTO has played a significant role in promoting international trade and reducing trade barriers. By establishing principles such as MFN treatment and promoting free trade, the agreement has helped countries around the world to grow their economies and improve their standards of living. While there have been criticisms of the GATT/WTO, it remains an important institution in the global trade landscape.