Developing Countries in the World Trading System

Developing Countries in the World Trading System

The Uruguay Round and Beyond

Edited by Ramesh Adhikari and Prema-chandra Athukorala

The book examines the achievements of the Uruguay Round of trade negotiations in reforming the world trading system and the challenges to future reforms. It begins with an overview of the genesis of the world trading system and moves on to examine the key issues as they relate to developing countries. These include further liberalization of agricultural trade; abolition of the Multifibre Arrangement; environmental and labour standards; competition policy; regional integration in South East Asia; and the implications for developing Asian countries of the liberalization of the Chinese economy and its WTO membership. Furthermore, the book discusses the links between trade liberalization and poverty reduction – drawing on the experience of Asian countries – and puts forward arguments on how trade liberalization could effect a greater reduction in poverty.

Chapter 1: Developing countries in the world trading system: an overview

Ramesh Adhikari and Prema-chandra Athukorala

Subjects: business and management, international business, development studies, development economics, law and development, economics and finance, development economics, international economics, law - academic, law and development

Extract

Ramesh Adhikari and Prema-chandra Athukorala The Uruguay Round (UR) of multilateral trade talks, which formally concluded on 15 August 1994 in Marrakesh, Morocco, after eight years of intense and often contentious negotiations, was a landmark in the evolution of the global trading system. The Uruguay Round Agreement signed at Marrakesh embodied three key outcomes, which were crucial for laying the foundation for an effective, rules-based trading system, namely: (a) providing for the establishment of the World Trade Organization (WTO) as the successor to the General Agreement on Tariffs and Trade (GATT); (b) laying down provisions to ensure participation by developing countries as equal partners in the world trading system; and (c) broadening the coverage of international trade rules to encompass virtually all economic activities relevant to economic interaction. For almost fifty years following World War II the global trading system functioned without a fully fledged organization with well-defined rules of decisionmaking and enforcement to deal with trade issues among countries. The GATT, which came into being in 1947 on the basis of the Protocol of Provisional Application signed at the United Nations Conference on Trade and Employment in Havana, Cuba, on 21 November in that year,1 did not have the international standing of the International Monetary Fund (IMF) or the World Bank, both of which were international organizations. Instead the GATT, as its name implied, was a multilateral agreement among its contracting parties rather than a treaty among sovereign nations (Jackson 1989). By contrast, the WTO, which came into...

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