This paper reviews major issues and developments in the trade area and outlines the challenges governments face as they seek to liberalize trade in the Uruguay Round of trade negotiations and address new trade issues. In industrial countries, the reorientation of policies was most apparent in steps taken to liberalize financial markets and foreign direct investment, privatize public enterprises, and deregulate services, particularly in the transportation and communication sectors. Among developing countries, a growing number recognized the merits of outward, market-oriented policies and took steps to liberalize their trade regimes and open their economies to international competition. By and large, the increased focus on market principles in industrial countries did not carry over to trade and industrial policies or, most notable, to the agricultural sector. Despite strong growth performance in 1983–1989, little progress was made in rolling back the protective barriers that had risen during the preceding recessionary period; protection persists in agriculture and declining sectors and has spread to newer high-tech areas.
The European Communities (EC) were established by the Treaty of Paris (1951) and the Treaties of Rome (1957).1 The original six EC members2 were later joined by the United Kingdom, Ireland, and Denmark in 1973, Greece in 1981, and Spain and Portugal in 1986. Excluding intra-area trade, the EC now accounts for almost one fifth of world exports and nearly as much of world imports. Its weight in world trade is thus somewhat less than that of the United States and Japan taken together (Table 9).
Ministers, meeting on the occasion of the Special Session of CONTRACTING PARTIES at Punta del Este, have decided to launch Multilateral Trade Negotiations (The Uruguay Round). To this end, they have adopted the following Declaration. The multilateral trade negotiations (MTN) will be open to the participation of countries as indicated in Parts I and II of this Declaration. A Trade Negotiations Committee (TNC) is established to carry out the negotiations. The Trade Negotiations Committee shall hold its first meeting not later than 31 October 1986. It shall meet as appropriate at Ministerial level. The Multilateral Trade Negotiations will be concluded within four years.
Robert E. Baldwin, Richard H. Snape, Rudiger Dornbusch, Timothy D. Lane, Mr. Guillermo Calvo, Charles P. Kindleberger, Bahram Nowzad, Sanjaya Lall, Carl Dahlman, Geza Feketekuty, Patrick A. Messerlin, Robert B. Dickie, Thomas A. Layman, Lloyd Kenward, Mr. David P. Currie, Mr. David A Vines, and F. Desmond McCarthy
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The Final Act of the Uruguay Round was signed in Marrakesh in April 1994, bringing to a conclusion the eighth and most ambitious set of multilateral trade negotiations. One hundred and twenty-five countries participated in the Round, which will reduce tariff and nontariff barriers to trade in goods, strengthen trade rules and extend multilateral rules to new areas—services and intellectual property—and establish the World Trade Organization. Developing countries participated more actively in the negotiations than hitherto and will be more fully integrated into the multilateral trading system after the Round. This paper investigates the economic implications of these different aspects of the Uruguay Round on industrial, developing, and transition economies, based on information available at the time of preparation of the paper. A quick reference guide to the Round provides a synopsis of the main results (Appendix I) and should be read in conjunction with individual sections below.
Regional integration is not new. It has been a continuing part of the post-World War II trade landscape. Recently, however, it has attracted increased interest. Existing arrangements have been, or are being, extended in their membership and deepened in their coverage; old arrangements are being revived; and new regional groupings are being formed. The three distinctive features of this trend are: the “conversion” of the United States to the regional approach; the emergence of regional arrangements among industrial and developing countries; and an apparent move away from inward-oriented toward more outward-oriented arrangements among developing countries, particularly in the Western Hemisphere. In developing countries, these developments are being accompanied in many cases by unilateral trade liberalization.
This paper reviews recent developments and issues in trade and trade-related policies of the industrial. Eastern European, and developing countries, focusing primarily on the period since the most recent occasional paper prepared in 1988.1 The paper is organized as follows. Section I reviews the international economic environment and describes briefly the recent developments in trade policy. Section II describes recent trade trends in industrial and developing countries against which developments in trade policies are analyzed. Sections III, IV, and V review developments and issues in trade policy for the industrial, Eastern European, and developing countries, respectively. Section VI provides more detailed coverage of trade-related policies in the agricultural sector and surveys the empirical evidence on the costs of protection and the possible effects of trade liberalization in this sector. Section VII provides an overview of the issues that will be central to the trade policy discussions of the 1990s. Appendix I reviews activities of the General Agreement on Tariffs and Trade (GATT). Appendix II surveys the relationship between trade and competition policies. Appendix III discusses some of the methodological issues involved in measuring the incidence and effects of nontariff barriers, looks at estimates of the costs of protection in selected industrial sectors affected by nontariff barriers, and compares the results of researchers’ efforts to estimate the possible gains from multilateral trade liberalization.