What Does General Agreement on Tariffs and Trade Mean

The General Agreement on Tariffs and Trade (GATT) is a multilateral trade agreement signed in 1947 with the goal of promoting international trade by reducing trade barriers such as tariffs, quotas, and other impediments to trade.

The GATT was signed by 23 countries and has been joined by over 120 other countries since then. The agreement established rules and principles for international trade, including the most-favored-nation principle, which requires that each country treat all other members of the agreement equally.

The GATT was replaced by the World Trade Organization (WTO) in 1995, but the principles established by the GATT were incorporated into the WTO`s agreements.

One key achievement of the GATT was the reduction of trade barriers through a series of rounds of negotiations, known as the Uruguay Round, which began in 1986 and ended in 1994. This round led to the creation of the WTO and the signing of agreements on agriculture, textiles, services, intellectual property, and other issues.

The GATT and the WTO have been criticized for favoring developed countries over developing countries, and for their emphasis on free trade at the expense of other economic and social goals. However, the organizations have also been credited with encouraging global economic growth and creating a more stable and predictable environment for international trade.

In conclusion, the General Agreement on Tariffs and Trade is a multilateral trade agreement signed in 1947, with the goal of promoting international trade by reducing trade barriers. The principles established by the GATT were incorporated into the WTO`s agreements, which have been credited with encouraging global economic growth and creating a more stable and predictable environment for international trade.