Introduction
During the period of world war2 discussions were going on at Bretton woods aimed at international cooperation in monetary and financial field,it was felt that cooperation should also be bought in field of international trade and therefore a need for establishing a body of nations to guaid policies in the 8th phase of international trade was felt.there was a porposal to setup international trade organization with the objectives of promoting world trade economic development.most countries did not agree on the scope of proposed ITO.
Membership of the GATT
Since its established in 1940 the membership of GATT have gone up from 23 to 140 made of both developed and developing countries New member can admitted with the consent of two-third members if the GATT members of the GATT must accept the code of conducts of GATT.
Important principles of the GATT
The GATT agreements based on the following guiding principles.
1. There will be non-discriminatory trade among member states.Thats is a national trade policy should be applied equally all the member states.
2. Tariff should be the only investment to influence inti trade.
3. There should be consultations among member states action is taken by any member state that might harm for other member states.
4 Arrangements should be made for negotiations for tariff and trade.
Objectives of GATT
The general objectives of GATT is to enable member states to enter into reciprocal and mutually advantagies arrangements to bring about such stational reduction in tariff as also reduction or removal of other barriers to international trade and if possible elimination of discriminatory practices in the sphere of international trade.In other words the general objectives of GATT are.
1. To bring about improvement in the standard of living of people in member states.
2. To encourage full employment and steady and growing lelve of real income and effective demand.
3. To bring about exponsion of world trade world production .
4. To enable full use of the world's resources.
GATT strategy for achieving its objectives.
GATT proposes to achieve the above objectives through the following methods.
1. Principles of most favoured nation clause or Elimination of discrimination
2. Quantitative restrictions in imports
Tariff Negotiations and Reduction of Tariffs.
The GATT recognized that tariffs are often obstacle to international trade and therefore,GATT would encourag negotiations for the reduction of high tariffs.
Performance of GATT.
The driving force behind the GATT was the same as that which motivated to Bretton woods conference in 1943 ,the inter-war disaster.The interdisaster period should not just be seen as period of domestic economic failures but as an international economic failure as well.
Just as the architects of the Bretton woods system.Envisioned restoring the international monetory system.The purpose of GATT was to roll-back trade barriers and end discriminatory trade policies.
Geneva Round
The first round of tariff negotiation was held at Geneva in april 1947.The discussion reached at certain agreements of exchanging concessions in tariffs to member states.
In 1956 another conference of GATT was held at Geneva at this conference united states went to the limit of negotiating power granting commission of concession in respect of its imports and exports,but no country satisfied and several states withdrwal from the negotiation at the fourth conference of GATT.At the fifth conference at Geneva the developing states pointed out that industrialized states avoided negotiation on products which were of vital interests to developing states and they demonded the conference could be successful only if the industrialized were prepared to grant unitateral tariff concession.
The GATT sixth conference held in may 1964 at Brussels is know as the Kennedy round.President Kennedy suggested in this conference all round reduction in tariffs.The main objectives was reducing trriffs between the US and the EEC and EFTA.It might be recalled that historically the united states had been strongly in favoure of production mainly as means of safeguarding standard of living of peoples in he united states against cheap laboure in the rest of the states of the world.
In the round the participants agreed to reduce last tariffs to 1/3 of tariffs for a period of 8 years.Another important step was to control non-tariffs barriers.In agricultural sector that reduced to greater extent TBS and NTBS.Another important achievement was the prefrential trade with developing states.
In the years between 1987 to 1993.The most important decision was the formulization of the character of WTO.They stressed on global liberalization expansion of trade.Further reduction in NTA's during this round it was also stressed that developing countries should give 1% of their GDP to LDC's.As the third world states were the main providers of the raw material and the industrialzed states gave finished shape.So,it was decided that the materials should ve sold to LCD's at less castly prices.
Achievements of GATT.
At the time of 1993-1994 93% of world total trade was conducted by GATT.Average tariff of main trading nationa have been reduced to 7.7% on all industrial productes.9.8% on finished manufactured products,3% on semi-finished prducts and 2% on raw material.
Conclusion.
On should neither overstate nor under states the impact of GATT on the post wat world economy.The GATT deserves some contributtory credit the post world war2 econmic boom.
Over time,GATT scraped trade barriers,For,this reason,inpite of its small size and non specific local as and economic institution,the GATT is a long term impact on the world economy has beed more significant than IMF and world bank.
The GATT's success was by no means uniform.In replacing the GATT,the WTO promises to fill in some liberalizing agricultural trade abd strebgthung also settlement procedure without entitling a radical innvoation in the WTO's primary purpose.Whether the promises will be fullfiled remains to be seen
