At the same time, 15 countries focused on negotiating a simple trade agreement. They agreed to remove trade restrictions on $10 billion or one-fifth of the world`s trade zone. A total of 23 countries signed the GATT agreement on 30 October 1947, paving the way for its implementation on 30 June 1948. The General Agreement on Tariffs and Trade (GATT), signed on 30 October 1947 by 23 countries, was a legal agreement to minimize barriers to international trade by eliminating or reducing quotas, tariffs and subsidies, while maintaining important rules. The GATT is expected to stimulate economic recovery after the Second World War through the reconstruction and liberalization of world trade. The details of the GATT were optimized in the decades following its creation. The main objective of the continuation of the negotiations was the continuation of the reduction of tariffs. In the mid-1960s, the Kennedy Round added an anti-dumping agreement. The Tokyo Round of the 1970s improved other aspects of trade. The Uruguay round lasted from 1986 to 1994 and created the World Trade Organization. The General Agreement on Tariffs and Trade (GATT) was the first multilateral free trade agreement. It first came into force in 1948 as an agreement between 23 countries and remained in force until 1995, when it joined 128 countries. It has been replaced by the World Trade Organization.
In addition, countries could restrict trade for national security reasons. These include patent protection, copyright and public morality. The GATT has introduced the principle of the most favoured nation into members` collective agreements. THE GATT continues to live as the foundation of the WTO. The 1947 agreement itself no longer exists, but its provisions were incorporated into the 1994 GATT agreement. Trade agreements should thus continue to operate during the wto`s implementation. That is why the 1994 GATT is an integral part of the WTO agreement. Most nations have adopted the nation`s most preferred principle when setting tariffs, which has largely replaced quotas. Tariffs (preferably quotas, but still an obstacle to trade) have in turn been constantly reduced in successive rounds of negotiations. The GATT had three main provisions.
The most important requirement was that each member be obliged to confer the status of the most favoured country on any other member. All members must be treated the same with respect to tariffs. It excluded special tariffs between members of the British Commonwealth and the Customs Union. It allowed tariffs if their removal causes serious damage to domestic producers. The goal of the GATT was to eliminate harmful trade protectionism. Trade protectionism probably contributed to the 66% reduction in world trade during the Great Depression. The GATT helped restore the world`s economic health after the ravages of depression and World War II. The General Agreement on Tariffs and Trade was a free trade agreement that eliminated tariffs and increased international trade.
As the first multilateral free trade agreement, GATT governed an important part of international trade between January 1, 1948 and January 1, 1995. The agreement ended when it was replaced by the more robust World Trade Organization (WTO). Governments dethrone a degree of control over an international agreement. Unlike the ITO charter, the GATT did not need congressional approval.