General Agreement On Tariffs And Trade (GATT) Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of General Agreement On Tariffs And Trade (GATT), written in plain English, along with examples of how it is used.
What is General Agreement On Tariffs And Trade (GATT)?
“International treaty established in Geneva, Switzerland in 1947 that reduces import and expert tariffs as well as other trade barriers. The treaty is enforced by the World Trade Organization (WTO).
History and Meaning of General Agreement On Tariffs And Trade (GATT)
The General Agreement on Tariffs and Trade (GATT) is a multilateral trade agreement that was formed in 1947. Its primary objective was to reduce trade barriers and tariffs between member countries in order to promote international trade. The agreement was signed by 23 countries and governed trade relations between them until 1995 when it was replaced by the World Trade Organization (WTO).
The GATT resulted from negotiations among allied countries during World War II, and it was initially intended to be a temporary measure to promote the flow of trade between countries after the war. However, as its importance became clear, it was re-negotiated eight times and transformed into an institutional framework that aimed to reduce trade barriers and enhance international trade.
The GATT led to a significant reduction in tariffs and trade barriers worldwide, contributing to the post-war growth in international trade that transformed the global economy. It was replaced by the WTO, which inherited and expanded the GATT's mandate as a forum for international trade negotiations among member countries.
Examples of General Agreement On Tariffs And Trade (GATT)
- The GATT negotiations resulted in significant reductions in tariffs and trade barriers between member countries, contributing to increased international trade.
- The GATT enabled developing countries to participate more fully in international trade, encouraging economic growth and development worldwide.
- The GATT agreements played a crucial role in transforming the global economy and paving the way for modern international trade relationships.
Legal Terms Similar to General Agreement On Tariffs And Trade (GATT)
- World Trade Organization: An international organization that replaced the GATT in 1995 and works to promote international trade by reducing trade barriers and harmonizing trade regulations.
- Free Trade Agreement (FTA): A trade agreement between two or more countries that eliminates trade barriers and tariffs on goods and services traded between them.
- Customs Union: A type of economic union between countries that eliminates trade barriers between member countries and imposes a common external tariff on goods and services imported from countries outside the union.