GATT, an acronym for General Agreement on Tariffs and Trade, refers to a multilateral international trade agreement that was established to regulate and facilitate global trade. The agreement came into effect on January 1, 1948, and aimed to promote economic cooperation and remove trade barriers among the participating nations.
GATT provided a framework for negotiations, dispute resolution, and the reduction of tariffs and other trade barriers. The agreement sought to encourage fair and open trade practices, reducing discrimination between member countries and ensuring nondiscriminatory treatment of imported goods through the most favored nation (MFN) principle.
Under GATT, member states engaged in rounds of negotiations to progressively lower tariffs, resolve trade disputes, and make improvements to the international trading system. These negotiations resulted in various agreements that significantly contributed to the liberalization of world trade.
However, GATT was replaced by the World Trade Organization (WTO) in 1995, which expanded its scope to include trade in services, intellectual property, and agricultural products. The WTO continues to build upon the principles and foundation set by GATT, ensuring the free flow of goods, services, and investments across borders while maintaining fair and balanced trade practices.
Overall, GATT was a landmark agreement in international trade, playing a fundamental role in fostering global economic integration and establishing a rules-based trading system that promotes stability, predictability, and fairness among nations.
