1. INSIGHTS ON GATT & WTO
Presented by : Group 3
National College, Center for Development Studies
5/7/2013RegiMilan

2. HISTORICAL BACKGROUND AND DEVELOPMENT
Mercantilist economist(1500-1750AD)
Focus on country’s economic welfare and growth
But focused on Protectionism trade policy rather than free
trade.
UK, France, Germany, Austria and other- Europe
Imperialism concept developed in Asia, Africa and South
America by European countries
But trade didn’t foster within European nations(trade barriers
and protectionism)

3. BRETTON WOOD CONFERENCE AND GATT
•New Hampshire, USA(1944, July)-45 nations
•IBRD(World Bank): established on 1945, December
•IMF: established on 1945, December
•International Trade Organization(ITO): No agreement
between USA and other nations

4.  1945,December: 15 countries group sat for tariffs reduction
and boundary of trading goods.
 1st round: trading rules determination, 4500 goods tariffs
cutoff
 Trading: $10 Arab(1/5th of world trade)
 Member nations increased to 23.
 1947,October 30: GATT came into existence until ITO will be
formed
 1948, January 1: GATT Contracting Parties
 1948, June 30: Tariff subsidy regulations came into existence

5.  Havana, Cuba(1947, November): Charter prepared and presented
on United Nations Conference on Trade and Employment.
 But failed.
 Between 1st Jan 1948-1st Jan 1995: GATT worked as the facilitator
for multilateral trade system and monitoring body.
• 1989, may16 applied for GATT membership.
• 1995, dec05 formal application for membership.
• 2004, april23 Nepal got membership.


6. Year Country Negotiation Topics Partic
ipatio
n
1947 Geneva,
Switzerland
Custom Duty Reduction 23
1949 Annissee, France Custom Duty Reduction 13
1951 Torkee, U.S. Custom Duty Reduction 38
1956 Geneva,
Switzerland
Custom Duty Reduction 26
1960-61 Geneva(Dillon
Round)
Custom Duty Reduction 26
1964-67 Geneva(Kennedy
Round)
Custom Duty Reduction and Anti-dumping
provision
62
1973-79 Geneva(Tokyo
Round)
Custom, non-custom and framework
negotiation
102
1986-
1994
Geneva(Uruagua
y Round)
Custom, non-custom rules, service sector,
TRIPS, conflict management, establishment of
WTO
123

7. NEPAL’S COMMITMENTS IN THE WTO
 Agricultural products-
 Non- Agricultural products-
 Services
 Trade-related Aspects of Intellectual
Property Rights (TRIPS)
 Regulatory reforms

8. BENEFITS OF JOINING WTO TO NEPAL
1. Degree of certainty of market access:
WTO trading system provides a degree of
certainty of market access. Trade become more
predictable, which in turn encourages trade and invest
in the country.
2. Transit right :
The WTO rules grant transit rights to the member
countries. This is a most important benefit of WTO
membership for a landlocked country such as Nepal. It
has a crucial impact not only on Nepal’s foreign trade
but also on the whole process of its development. An
unhindered and cost-effective transit facility enhances
the competitive strength of the economy.

9. 3. Rule based trade regime:-
WTO membership enforces a rules-based trade regime,
increasing transparency and reducing corruption and
uncertainties in trading activities.
4. Market access:-
Market access opportunities provided by the WTO system
can lead to further investment addressing the constraint of
limited domestic market for economic scale of productive
operation, which will also help to raise investment, economic
production of goods and services and industrialization process .
5. Policy stability.
6. Attract foreign direct investment.
7. Benefits from liberalization
8. Mobility of trade related technical assistance.

10. MARKET ACCESS BARRIERS FOR NEPAL
TARIFF AND NON-TARIFF BARRIERS
 Tariff barriers serve the legitimate interest of the
importing countries to protect their domestic
industrial or agricultural sectors from foreign
competition. The tariff barriers for Nepal are as
following:-
10

11.  Tariff barriers on leather.
 Tariff barriers on readymade garments.
 Tariff barriers on tea.
 Tariff barriers on readymade garments.
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12. NON- TARIFF BARRIERS
 The term “non-tariff ” is a residual one that covers all
measures that restrict imports other than tariffs. Non
tariff barriers are as follows:-
 Rules of origin
 Regulatory barriers

13. SUPPLY SIDE CONSTRAINT
 Despite the market access barriers mentioned
above, Nepal’s WTO membership offers predictable
market access in a range of products of export
interest to Nepal. However, several supply-side
constraints reduce the competitiveness of Nepalese
exports and they are as follows:
 Human capital
 Infrastructures
 Quality assurance and certification
 Access to finance
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14. IMPACT OF TRADE BARRIERS
 Advanced industrial nations committed themselves after
World War II to removing barriers to the free flow of
goods, services, and capital between nations
 This goal was enshrined in the General Agreement on
Trade and Tariffs .
 Under the umbrella of GATT, eight rounds of negotiations
among member states(now numbering 146) have worked
to lower barriers to the free flow of goods and services
 The most recent round of negotiations, known as the
Uruguay Round, was completed in Dec,1993.The Uruguay
round further reduced trade barriers; extended GATT to
cover services as well as manufactured goods; provided
enhanced protection for patents, trademarks, and
copyrights; and established the World Trade Organization
(WTO)to police the international trading system
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15. IMPACT OF TRADE BARRIERS
 In the late 2001, the WTO launched a new round of talks
[Doha,Qatar] aimed at further liberalizing the global
trade and investment framework.
 The agenda included cutting tariffs on industrial goods,
services,and agricultural products; phasing out subsidies
to agricultural producers; reducing barriers to cross
border investments; and limiting the antidumping laws.
 The rich nations spend around $300 billion a year in
subsidies to support their farm sectors. The worlds
poorer nations have the most to gain from any reductions
in agricultural tariffs and subsidies.
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16. • Trade openness: Trade/GDP is one of the variables
used to measure trade openness of an economy.
• Export: Nepal has witnessed a slow increase in the
absolute value of exports in recent years.
• Import: In terms of imports, Nepal’s imports over
the years have been higher than exports
Nepal’s trade performance after WTO membership

17. THANK YOU
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