1. Seventh round:
Tokyo Round - 1973-1979
Reduced tariffs and established new regulations aimed at controlling the proliferation of non-tariff
barriers and voluntary export restrictions. 102 countries took part in the round. Concessions were made on
$190 billion worth.
Both from the point of view of participation and the breadth of the negotiating agenda, this was the
biggest round up to that time. The Tokyo Round was launched on 14 September 1973 at a Ministerial
meeting in Tokyo, but the negotiations were conducted largely in Geneva.
The Uruguay Round began in 1986. It was the most ambitious round to date, hoping to expand the
competence of the GATT to important new areas such as services, capital, intellectual property, textiles,
and agriculture. 123 countries took part in the round. TheUruguay Round was also the first set of
multilateral trade negotiations in which developing countries had played an active role.[4]
Agriculture was essentially exempted from previous agreements as it was given special status in the areas
of import quotas and export subsidies, with only mild caveats. However, by the time of the Uruguay
round, many countries considered the exception of agriculture to be sufficiently glaring that they refused
to sign a new deal without some movement on agricultural products. These fourteen countries came to be
known as the "Cairns Group", and included mostly small and medium sized agricultural exporters such
as Australia, Brazil,Canada, Indonesia, and New Zealand.
The Ministerial declaration setting out the ambit for the negotiations foresaw work aimed at:
(a) Tariff negotiations using the formula method,
(b) Reducing or eliminating non-tariff measures,
(c) Examining the possibility of reducing or eliminating all barriers in selected sectors,
(d) Examining the adequacy of the multilateral safeguard system,
(e) Negotiations in agriculture, taking into account the special characteristics and problems in this sector,
and
(f) Treating tropical products as a special and priority sector.
Ministers intended that the negotiations should be concluded in 1975.
The Tokyo Round negotiations were dominated by events within the United States, the European
Economic community (EEC), Japan and the relations between them. The President did not have any
negotiating authority until January 1975 when the Trade Act of 1974 was made into law. This negotiating
authority was due to expire on 3 January 1980.
The situation was complicated by the fact that 1976 was a presidential election year. The EEC had
expanded its membership to nine on 1 January 1973 and was preoccupied with making the enlarged
system work. Its internal coordinating system accordingly became much more complex.
2. Japan had achieved its transformation into a first-rate trading power and had become the subject of
protectionist pressures in many economies. The various negotiating groups, in which the specialized
negotiations economies. The various negotiating groups, in which the specialized negotiations would take
place, were only established in February 1975. Most were chaired by GATT Secretariat personnel.
The developing countries were drawn into the negotiating process much more than during the Kennedy
round. This was the time of heightened developing-country expectations in that it coincided with
preparations for the New International Economic Order initiative and the intensification of the North-
South dialogue.
Much necessary preparatory work of a substantive nature was done between 1973 and early 1977, but no
real developments in the negotiations were possible until the new United States administration had
formulated its policies and appointed its negotiating team. Negotiations began in earnest in July 1977
following a meeting between the United States and the EEC, which ironed out some of their major
differences on policy and procedure.
The two reached agreement that three should be an accelerated timetable consisting of four phases to be
concluded by January 1978.
The first phase would consist of a general tariff plan, including a tariff-cutting formula using the Swiss
formula as a working hypothesis, and specific directives for the treatment of agriculture.
The second phase would cover the tabling of requests for tariff cuts and the removal of non-tariff
measures.
Phase three would see the tabling of draft texts for the codes on non-tariff measures, and in the fourth
phase participants would respond to the requests by tabling offers.
By July 1978 a large group of developed countries was able to put forward a "Framework of
Understanding" which set out the principals elements they considered necessary for a balanced outcome
to the negotiations. The developing countries objected to this package on substantive and procedural
grounds.
They objected particularly to what they saw as an attempt to leave them at the periphery of the
negotiations. The package nevertheless was an important factor in maintaining momentum as agreement
emerged to conduce the negotiations by 15 December 1978.
A major obstacle then turned up in the form of a section of the United States Trade Act which allowed the
President to waive a requirement that countervailing duties be imposed on subsidized imports over the
four-year period ending on 3 January 1979. If the existing waiver lapsed, countervailing duties would
become automatic. Congress appeared reluctant to renew the waiver, but it did so once the EEC declared
that it could not conclude the negotiations unless the United States first solved its internal problems.
This happened in late March 1979, and the Tokyo Round negotiations ended formally on 12 April 1979.
The negotiations resulted in average cuts of tariffs by developed countries for industrial products of about
35%, and average tariffs were reduced to about 4.7%, to be phased in over eight years. The Tokyo Round
resulted in nine separated agreements (six of which were called "codes") and four understandings on the
aims and operation of the GATT. These agreements and understandings added considerably to GATT
law.
3. Most of them were adapted further in the Uruguay Round and incorporated in the formal overall
outcome for that round. Little progress was made on systemic issues in trade in agricultural
products. There was agreement that negotiations should be continued after the round on the
development of a Multilateral Agricultural Framework aimed at avoiding continuing political
and commercial confrontations in this highly sensitive sector. In reality this was no more than a
device enabling the conclusion of the round as a whole and, as many expected, it did not lead
anywhere once negotiations resumed.
Achievements in the negotiations on tropical products were uneven, but reductions in tariffs and
non-tariff measures occurred across the full range of these products. No agreement was reached
concerning a multilateral safeguard system, but negotiations were continued after the round,
though without much success. One outcome developing countries saw as particularly important
for them was the Enabling Clause.
It was aimed at promoting an increased participation by developing counties in the global trading
system, and it allowed developed GATT members to accord differential treatment in favor of
developing countries in the tariff and non-tariff areas. On e of its unintended effects was to
diminish further the influence of developing countries in the rule-making activities in the GATT.