The General Agreement on Tariffs and Trade (GATT) was a treaty that was signed by representatives of over 60 countries in 1947. Its primary objective was to promote free trade among member countries and reduce or eliminate tariffs on goods traded between them.
The GATT was created in response to the economic devastation caused by World War II, which had left many countries struggling to rebuild their economies and trade with other nations. The GATT aimed to create a more stable and predictable environment for international trade, by providing a framework for negotiations and establishing rules and principles to govern trade between member countries.
One of the key principles of the GATT was the principle of non-discrimination, which meant that member countries had to treat each other equally in terms of trade policies and practices. This principle was embodied in the Most-Favored Nation (MFN) clause, which required member countries to extend to each other any trade benefits or concessions they offered to other countries.
Another important principle of the GATT was the principle of tariff reduction, which aimed to lower or eliminate tariffs on goods traded between member countries. This was done through a series of negotiations known as “rounds” of talks, during which member countries would agree on new tariff reductions and other trade-related measures.
Over the years, there has been general agreement among member countries that the GATT has been successful in achieving its primary objective of promoting free trade and reducing trade barriers. The GATT was replaced by the World Trade Organization (WTO) in 1995, which continues to promote free trade and reduce trade barriers through a similar framework of negotiations and principles.
In conclusion, the General Agreement on Tariffs and Trade (GATT) was a treaty signed by over 60 countries in 1947, aimed at promoting free trade among member countries and reducing or eliminating tariffs on goods traded between them. The GATT was successful in achieving its primary objective and was replaced by the World Trade Organization (WTO) in 1995, which continues to promote free trade and reduce trade barriers.