The Role and Importance of GATT in International Trade

The global economic crisis between the First and Second World Wars was to some extent caused by the introduction of prohibitive tariffs and quotas in many countries, as well as protectionist measures aimed at combating the import of goods. To avoid such tariff wars, after the Second World War, in 1947. Representatives of the most influential countries in trade gathered in Havana (the capital of Cuba) to establish the International Trade Organization. Unfortunately, this organization was unable to start its practical activities due to objections to its authority. Accordingly, the it mission was assigned to the General Agreement on Tariffs and Trade (GATT-s). During the existence of the GATT, eight rounds of negotiations have been held. As a result, tariffs imposed by developed countries decreased from an average of 40% in 1948 to about 3% in 2003. With the reduction of tariffs, countries realized that non-tariff restrictions on international trade had become no less serious obstacles. That is why much attention was paid to reducing non-tariff restrictions in the framework of the Uruguay Round. However, one of the important achievements of the Uruguay Round was the decision to establish the World Trade Organization.