Prelim #2

Question 1

What are the major accomplishments of the Uraguay round of the GATT

Answer 1

1. Tariff reductions: averaging 40% for industrial countries spread over 5-10 yrs. Elimination of tariffs in selected sectors (steel, pharma, medical and construction equipment).
2. Decreasing/eliminating some non-tariff trade barriers (VER’s, import quota,
3. Extension of trade disciplines in three new areas
   
   • Intellectual property
   • Services
   • Agriculture

Question 2

GATT accomplishments in the Agriculture sector

Answer 2

• Reduced export subsidies
• Reduced existing and new tariffs
• Quotas and other non-tariff barriers converted to tariffs
• Market access established through
• …

Question 3

Is the extension of trade rules to intellectual property, services and agriculture good or bad for the United States?

Answer 3

Good because the U.S. has a comparative advantage in all of these sectors

Question 4

What are some “other” outcomes of the Uruguay round?

Answer 4

• Elimination of the Multi-Fiber agreement
• Creation of the World Trade Organization (1995)

Question 5

What is the World Trade Organization (1995)

Answer 5

• Permenant organization

Question 6

Issues regarding the WTO

Answer 6

• Labor and environmental standards
• WTO does not prohibit national law making - only the use of trade restrictions (to which the government have already agreed) to enforce them
• “Race to the bottom” - argument: to maintain competitiveness in a global trading environment, firms cut costs, including violating labor and environmental regulations
• Dispute settlement panels and accountability –>Dispute resolution: a formal process by which disputes can be resolved
• Representation, participation, and transparency

Question 7

What are some opposing arguments to “Race to the bottom”

Answer 7

• economic growth promotes conservation ethic
• most governments over time develop stronger regulations
• in most industries, savings from pollution abatement are a small % of total production costs
• importance of countries buying-in” to multilateral reforms

Question 8

How many cases have been filed with the WTO from 1995- 2015

Answer 8

500+ cases

Question 10

Doha Round in the WTO Negotiations

Answer 10

• WTO has 164 members. Majority are low to medium income countries
• Began in 1998
• Restarted in 2001 in Doha, Qatar and gives special interest to developing countries
• Principal objects
  
  • tariff reductions
  • reduce tariff escalation
  • calrify/strengthen
  • …

Question 11

Doha Round concerns

Answer 11

• Market access and industrial tariffs in industrialized counties
• Tariff escalation
• Industrial countries agricultural subsidies, which keep world prices low
• Favorable trade in pharmaceuticals (e.g., AIDS drugs)

Question 12

Current status of Doha Round

Answer 12

• Suspended in 2006 - restarted in 2007 - stalled in 2008. In 2009 summit leaders pledged to complete Doha Round
• Pascal Lemy, Director General of WTO : 80% of trade issues resolved
• Financial and economic crisis of late 2000s contributed to difficulties in negotiating countries’ protectionism
• Bali Package
• Nairobi Package
• An uncertain future

Question 13

Bali Package

Answer 13

Dec. 2013 agreement