Agreement That Created a Set of Rules for International Trade
The agreement that created a set of rules for international trade is known as the General Agreement on Tariffs and Trade (GATT). GATT was signed on October 30th, 1947, and was in effect until January 1st, 1995, when it was replaced by the World Trade Organization (WTO).
GATT was created in response to the devastation of World War II, which caused a significant decrease in international trade and an increase in protectionism by countries. The primary objective of GATT was to promote free trade between countries and remove barriers that hindered the growth of international trade.
Under GATT, member countries agreed to lower tariffs on goods and services imported from other member countries and refrain from imposing non-tariff barriers, such as quotas and subsidies. The agreement also established rules for fair trade practices that prohibited dumping – the practice of selling goods at a lower price than the domestic market – and established measures to address disputes between member countries.
GATT was a significant milestone in international trade, as it was the first multilateral agreement to set standards for international trade. It allowed for increased global trade and helped to improve economic development and growth worldwide. GATT also paved the way for the creation of the WTO, which builds upon the principles of GATT and facilitates trade negotiations and dispute resolutions among its member countries.
In conclusion, the General Agreement on Tariffs and Trade was a groundbreaking agreement that created a set of rules for international trade. It allowed for increased collaboration and trade among member countries and paved the way for future agreements and organizations that continue to shape the global economy today.