General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO) are two organizations that have played a significant role in shaping international trade. These organizations were established to promote free trade and remove trade barriers. This article aims to give an overview of these organizations, their functions, and their impact on international trade.

General Agreement on Tariffs and Trade (GATT)

The General Agreement on Tariffs and Trade (GATT) was established in 1947. It was an international treaty signed by 23 countries with the aim of reducing trade barriers and promoting free trade. GATT’s primary function was to regulate and reduce the tariffs imposed on goods traded between countries. GATT’s primary objective was to promote economic growth by promoting free trade.

GATT had several rounds of negotiations, the most significant of which was the Uruguay Round, which concluded in 1994. This round saw the establishment of the World Trade Organization (WTO).

World Trade Organization (WTO)

The World Trade Organization (WTO) was created in 1995, replacing GATT. The United Nations established the WTO to promote international trade and economic growth. The WTO has 164 member countries, making it one of the most significant global organizations.

The main functions of the WTO are to administer WTO trade agreements and provide a forum for trade negotiations between member countries. The WTO also provides technical assistance and training to developing countries to help them participate in the global trading system.

The WTO has several agreements that member countries are required to adhere to. These agreements are designed to promote free trade and reduce trade barriers. Some of the most significant agreements are the General Agreement on Tariffs and Trade (GATT), the Agreement on the Application of Sanitary and Phytosanitary Measures, and the Agreement on Technical Barriers to Trade.

Impact on International Trade

The GATT and WTO have had a significant impact on international trade. By promoting free trade and reducing trade barriers, these organizations have facilitated the growth of global trade. As a result, several countries have experienced economic growth and development.

The GATT and WTO have also helped to resolve disputes between member countries. The dispute settlement mechanism provided by the WTO is one of the most effective dispute resolution mechanisms globally, ensuring that disputes are settled amicably and in a timely manner.

Final Thoughts

In conclusion, the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO) have played a significant role in shaping international trade. These organizations are essential in promoting free trade, facilitating economic growth, and resolving disputes between member countries. Countries that wish to participate in the global trading system are required to adhere to the agreements established by the WTO. Overall, the GATT and WTO have contributed to the growth and development of several countries worldwide.