Ch.10 GATT and WTO 20151103

1、 CHAPTER 10 GATT and WTOn GATTn WTOn China and WTO1 GATTn 1. The origination of the GATTn 2. The GATTs activities: eight trade negotiation “Rounds”n 3. The Uruguay Round of trade negotiationsn 4. Two GATTsn 5. WTO v.s. GATT: main differences1.The origination of the GATTn Handle the trade side of int

2、ernational economic cooperationn 50+ countries negotiated to create ITO (specialized agency of UN).n Draft ITO Charter: ambitious, broad areas.n Create the ITO at a UN Conference on Trade and Employment in Havana, Cuba in 1947. International Trade Organization (ITO)？n Meanwhile, 15 countries began t

3、alks in Dec.1945 to reduce and bind customs tariffs.n A deal on 45,000 tariff concessions(减让减让) was signed by 23 countries on 30 October 1947. nThe tariff concessions came into effect by 30 June 1948 through a “Protocol (议定书议定书) of Provisional Application”. nSo the General Agreement on Tariffs and T

4、rade was born, with 23 founding members (officially “contracting parties”缔约方缔约方).n The ITO Charter was finally agreed in Havana in March 1948, but ratification in some national legislatures proved impossible. n The most serious opposition was in the US Congress, even though the US government had bee

5、n one of the driving forces. n In 1950, the US government announced that it would not seek Congressional ratification (批准批准) of the Havana Charter, and the ITO was effectively dead. n So, the GATT became the only multilateral instrument governing international trade from 1948 until the WTO was estab

6、lished in 1995.2. The GATTs activities: eight trade negotiation “Rounds” (1)The first five rounds of trade negotiations (1947-1961) Some multilateral tariff reductions were achieved.YearPlace/nameSubjects coveredCountries1947GenevaTariffs231949AnnecyTariffs131951TorquayTariffs381956GenevaTariffs2619

7、60-1961GenevaTariffs26(2) The Kennedy Round of trade negotiations (1964-67)n The US led the way into a new round of negotiations from 1964 to 1967. n Tariffs on manufactured products were reduced by an average of 35%.n Little progress was achieved in reducing barriers on agricultural products.n Litt

8、le was done to ease non-tariff barriers.(3) The Tokyo Round of trade negotiations (1973-79)n It continued to reduce tariffs, bringing the average tariff on industrial products down to 4.7%. n A series of agreements on non-tariff barriers did emerge from the negotiations, in some cases interpreting e

9、xisting GATT rules, in others breaking entirely new ground. n It failed to come to grip with the fundamental problems affecting farm trade and also stopped short of （不再）（不再）providing a modified agreement on “safeguards” (emergency import measures). 3. The Uruguay Round of trade negotiations (1986-94

10、)Problems 1: GATTs credibility and effectiveness were undermined:n Governments in Western Europe and North America seek bilateral market-sharing arrangements with competitors and embark on a subsidies race to maintain their holds on agricultural trade. Problem 2: GATT had been found wanting (欠缺的欠缺的)

11、. It was clearly no longer as relevant to the realities of world trade as it had been in the 1940s.n Little success in liberalizing agricultural trade;n Trade in textiles and clothing was an exception to GATTs normal disciplines;n GATTs institutional structure and its dispute settlement system were

12、causing concern.n Only deal with trade in goods.The Uruguay Round experienced two phases:(1)The first four years, 19861990 (15 groups)1)Tariffs; 2) NTBs; 3)Tropical products; 4)Natural resource-based products; 5)Textiles and clothing; 6)Agriculture; 7)Safeguards; 8)Subsidies and countervailing dutie

13、s; 9)Trade-related intellectual property restrictions; 10)Trade-related investment restrictions;11)Services. Four other areas dealing with GATT itself.n The United States initially proposed a 10 year phaseout (过渡过渡期期) of all subsidies that affect agricultural trade and of all agricultural import bar

14、riers. n But the EU wanted to go more slowly and to moderate the extent of reduction in agriculture support. n By 1990, the wide disparity (不一致不一致) in subsequent proposals overshadowed all other aspects of the negotiations, and the four year effort had seemingly ended with no signed agreement on the

15、 liberalization of trade.(2) Continued negotiations lead to success, 1993n EC agricultural support program that harmed U.S. exports of oilseeds. In retaliation for the EC subsidy, the U.S. threatened to impose 200% tariffs on EC exports to the U.S. ($300 million).n An accord was eventually reached b

16、y which the oilseeds export subsidies were to be reduced 36% by value and 21% by quantity over a six-year period.n This positive development then set off activity to work again on many other aspects of the Uruguay Round. n Finally, after intense discussions, the 117 participating countries in the Ur

17、uguay Round reached agreement on December 15, 1993 and the signing took place on April 15, 1994, in Marakech, Morocco. n After ratification by participating countries, the agreement took effect on January 1, 1995.(3) Provisions of the Uruguay Round Agreementn Tariffs on average were cut by 34%.n The

18、 value of agriculture export subsidies was to be cut by 36% and most domestic support for agriculture by 20%.n Textiles and apparel trade was to be moved from the existing quota framework of Multi-fiber Arrangement into the GATT framework, with tariffs to be phased out over 10 years.n Revised rules

19、were adopted regarding dumping and export subsidies, and a voluntary export restraints were to be eliminated.n Actions on trade-related intellectual property rights (TRIPS) provided for minimum standards for trademarks, patents, and copyrights.n Some trade-related investment measures (TRIMS) were to

20、 be eliminated.n A specific General Agreement on Trade in Services (GATS) calls for “national treatment”.n New procedures were adopted for the settlement of disputes.n GATT itself was replaced by a new organization, the World Trade Organization.4. Two GATTsn (1) As an international agreement, GATT s

21、till exists. But it has been updated. The old version: “GATT 1947” The updated version : “GATT 1994”, lives alongside the GATS and TRIPSn (2) As an international organization created later to support the agreement, GATT no longer exists.5. WTO vs. GATT: main differences(1) Naturen GATT ad hoc and pr

22、ovisional (never ratified in members parliament and contained no provisions for the creation of an organization)n WTO permanent, has sound legal basis (members have ratified the WTO agreements)(2) Scopen GATT goods only. n WTO goods, services and trade-related aspects of intellectual property rights

23、.(3) Approach GATT selective basis (plurilateral) WTO (3 types): Multilateral (a single undertaking) Specific sector agreements Plurilateral: government procurement agreement(4) Dispute settlement WTO: Specific time limits, faster than the GATT 争端解决程序上采用反向一致争端解决程序上采用反向一致 （negative consensus）方式）方式, 而

24、不是而不是GATT的正向一致方式的正向一致方式 Has permanent appellate pelt body (上诉机构上诉机构) to review findings by dispute settlement panel.2 WTOn1. An Overview 2. The fundamental principles of the WTOn3. The structure of the WTOn4. WTO Agreementsn5. Ministerial conferences 1.An overviewnOne of the results of Uruguay Round

25、nEstablished in the light of the Marrakesh Agreement Establishing the World Trade Organizationnincluded in the Final Act （文件）（文件） Embodying the Results of the Uruguay Round of Multilateral Trade Organizations.nThe only international organization dealing with the global rules of trade between nations

26、. nBy 23, November, 2016, the WTO had 164 members. (117 are developing countries or separate customs territories)n The WTOs overriding objective is to help trade flow smoothly, freely, fairly and predictably. n It does this by: Administering trade agreements; Acting as a forum for trade negotiations

27、; Settling trade disputes; Reviewing national trade policies; Assisting developing countries in trade policy issues, through technical assistance and training programmes; Cooperating with other international organizations. 2. The fundamental principles of WTO(1) Trade without discrimination Treating

28、 other people (nations) equally. Most-favoured-nation treatment (MFNT): nCannot normally discriminate between their trading partners in goods, investment, services, and intellectual in goods, investment, services, and intellectual propertypropertynGATT Article 1, GATS Article 2, TRIPS Article 4.nExc

29、eptions: Free Trade Area, GSP, traded unfairly.nExceptions are allowed under strict conditions. National treatmentn Treating foreigners and locals equallyTreating foreigners and locals equally in goods, investment, in goods, investment, services, and intellectual property.services, and intellectual

30、property.n GATT Article 3, GATS Article 17 and TRIPS Article 3. GATT Article 3, GATS Article 17 and TRIPS Article 3. n National treatment only applies once a National treatment only applies once a product, service or item of product, service or item of intellectual property intellectual property has

31、has entered the marketentered the market. . n Therefore, Therefore, charging customs duty on an importcharging customs duty on an import is is not a violationnot a violation of national treatment even if locally-produced products are not of national treatment even if locally-produced products are no

32、t charged an equivalent tax.charged an equivalent tax.(2) Freer trade: gradually, through negotiation n Lowering trade barriers is one of the most obvious means of encouraging trade. n Eliminating NTBsn Opening markets can be beneficial, but it also requires adjustment. n The WTO agreements allow co

33、untries to introduce changes gradually, through “progressive liberalization”. n Developing countries are usually given longer time to fulfill their obligations.(3) Predictability: through binding and transparency n In the WTO, when countries agree to open their markets for goods or services, they “b

34、ind” their commitments. n A country can change its bindings, but only after negotiating with its trading partners, which could mean compensating them for loss of trade. n Discourage the use of quotas and other measures used to set limits on quantities of imports. n Make countries trade rules as clea

35、r and public (“transparent”) as possible. (4) Promoting fair competitionn Not an entirely free trade institution. The system does allow tariffs and, in limited circumstances other forms of protection. More accurately, it is a system of rules dedicated to open, fair and undistorted competition.n Many

36、 of the other WTO agreements aim to support fair competition. n Allow charging additional import duties calculated to compensate for damage caused by unfair trade. (5) Encouraging development and economic reformn Allow for special assistance and trade concessions for developing countries.n The agree

37、ments did give developing countries, particularly so for the poorest, “least-developed” countries, transition periods to adjust to the more unfamiliar and, perhaps, difficult WTO provisions. 3. The structure of the WTOHighest authorityCarry out the functions of the WTOMeet at least once every two ye

38、arsday to day businessrepresentatives of members （once/ 2 months） convenes also as the Dispute Settlement Body (DSB) and Trade Policy Review Body.3 Councils: Goods, Trips, Services.6 Committees: trade and development, trade and environment, regional trading arrangements administrative mittees dealin

39、g with specific subjects working party. goods council :11 committees4. WTO Agreementsn “The Results of the Uruguay Round of Multilateral Trade Negotiations: The Legal Texts” is a daunting list of about 60 agreements, annexes, decisions and understandings. n The agreements fall into a simple structur

40、e with SIX main parts: n An umbrella agreement (The Agreement Establishing the WTO)： 1 Agreements on three broad areas of trade： 3 (goods, services and intellectual property); Dispute settlement： 5 Reviews of trade policies： 6Table 10-2 The structure of the WTO agreementsThe basic structure of the W

41、TO agreements: how the six main areas fit together the umbrella WTO Agreement, goods, services, intellectual property, disputes and trade policy reviews.UmbrellaAgreement establishing WTO (1)GoodsServicesIntellectual propertyBasic principlesGATT (2)GATS (3) TRIPS (4)Additional detailsOther goods agr

42、eements and annexesServices annexesMarket access commitmentsCountries schedules of commitments (and MFN exemptions)Countries schedules of commitments (and MFN exemptions)Dispute settlementDispute settlement (5)TransparencyTrade policy review (6)Marrakesh Agreement Establishing the World Trade Organi

43、zation.Annex 1A: Multilateral Agreements on Trade in GoodsGeneral Agreement on Tariff and Trade 1994Agreement on AgricultureAgreement on the Application of Sanitary and Phytosanitary (植物检疫植物检疫) MeasuresAgreement on Textiles and ClothingAgreement on Technical Barriers to TradeAgreement on Trade-Relat

44、ed Investment Measures Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Antidumping) Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 (Customs Valuation)Agreement on Pre-shipment InspectionAgreement on Rules of

45、 OriginAgreement on Import Licensing ProceduresAgreement on Subsidies and Countervailing Measures Agreement on SafeguardsAnnex 1B: General Agreement on Trade in ServicesAnnex 1C: Agreement on Trade-Related Aspects of Intellectual Property RightsAnnex 2: Understanding on Rules and Procedures Governin

46、g the Settlement of DisputesAnnex 3: Trade Policy Review MechanismAnnex 4: Plurilateral Trade AgreementTable 10-3 The WTOs major legal textPre-shipment Inspection （PSI）Importing country engage companies to verify price,quantity, quality, etc., before the goods are shipped from exporting countries. T

47、o prevent over and under invoicing and fraud, thus prevent the flight (外逃外逃) of capital and the evasion of customs duties. Today, over 30 countries in Africa, Asia and Latin America use these serviceThe ten ministerial conferences since 19941996-12Singapore, disagreements on four issues (Singapore i

48、ssues)1998-05Geneva, Switzerland1999-11,12Seattle, USA, ended in failure, with massive demonstrations and police and National Guard crowd control efforts drawing worldwide attention.2001-11 Doha in Persian Gulf nation of Qatar.The conference also approved the joining of China2003-12Cancn, Mexico. ai

49、ming at forging agreement on the Doha round The G20 developing nations (led by India, China and Brazil), resisted demands from the North for agreements on the so-called Singapore issues and called for an end to agricultural subsidies within the EU and the US. The talks broke down without progress.20

50、05-12Hongkong. Countries agreed to phase out all their agricultural export subsidies by the end of 2013, and terminate any cotton export subsidies by the end of 2006. 2009-12The general theme for discussion was “The WTO, the Multilateral Trading System and the Current Global Economic Environment”.Th

51、e ten ministerial conferences since 19942011-12Geneva, Swiss“Importance of the Multilateral Trading System and the WTO”, Trade and Development” “Doha Development Agenda”. 2013-12Bali, IndonesiaA series of decisions aimed at streamlining trade, allowing developing countries more options for providing

52、 food security, boosting least-developed countries trade and helping development more generally2015-12Nairobi, Kenya11th 2017-12Buenos Aires, Argentina3 China and WTO1.Chinas accession to the WTO nChina was one of the 23 original signatories of the GATT in 1948. nAfter the Civil War and the establis

53、hment of the Peoples Republic of China and the Republic of China, the government in Taiwan was the official representative of China. nThe United Nations and the GATT wanted to impose an embargo on China, but this was not possible as long as China still was a member. Taiwans foreign trade was unremar

54、kable and to harm the government in Beijing, ROC President Jiang Kaishek announced that China would leave the GATT system. nAlthough the government in Beijing never recognized this withdrawal, nearly 40 years later in 1986, China notified the GATT of its wish to resume its status as a member of the

55、GATT. A working party was established in 1987 and Chinas long way of entering the GATT/WTO began. n 1987-03-04: Chinas Working Party concerned only Chinas trade regime for goods. n 1995: WTO Working Partys scope include trade in services, new rules on non-tariff measures and rules relating to intell

56、ectual property rights.n 2001-09-17: final meeting of the Working Party held, marks the final conclusion of negotiations on Chinas WTO accession.n 2001-11-10: the Doha Ministerial Conference approved by consensus the text of the agreement for Chinas entry into the WTO.n 2001-12-11: China ratified it

57、s membership and became a full member, the WTOs 143rd .2. Opportunities and challenges to China(1) Opportunities n China will be offered multilateral, unconditional and stable MFNT by all WTO Members. n As a full member, China will take part in all negotiations regarding various areas, stipulating a

58、nd amending the relative regulations as well as the construction of the multilateral trade system. n By making use of the mechanism and procedures of trade dispute settlement of the WTO, China can solve trade disputes with other countries more fairly and reasonably.n By making use of the WTO forum,

59、China may publicize its policy of reform and opening to the outside world, actively develop cooperation and communication with other countries in the field of economics, trade and technology.(2) Challenges Transparency and predictabilityn Laws and regulations including those not previously available

60、 to the public will be regularly published (in the WTO languages as well). n A 30-day period for obtaining information and commentary is planned prior to the implementation of new laws and regulations. Tariffsn Significantly reduce its tariffs on industrial products by January 2005 to 8.9% (down fro