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GATT’s history revises ideas about international organizations, trade in international relations, and the liberal global order. Although the USA and EEC receive the most attention in GATT studies, leadership was fluid and opportunistic and the engagement of small and mid-sized members sustained GATT s momentum and legitimacy. The secretariat was proactive in promoting trade liberalization and cooperation, whereas GATT members emphasized rights above obligations and pursued their economic interests in ways that were not always compatible with liberal trade practices. Reactions to GATT and trade liberalization were polarized and divisive. Not only does trade produce winners and losers, but some people had faith in the liberal promise and associated GATT with fairness, rules, and inclusive prosperity, whereas others feared it as a destructive agent of globalization that would cause domestic upheaval and undermine national autonomy. As for the liberal order, it was made up of national and international ideas and priorities that both pushed against and reinforced one another. Despite the presumption of liberalism s universal applicability, the liberal trade order was conservative, privileging some nations, some sectors of the economy, and some people over others. But because GATT retained a normative authority, members never rejected it entirely.
Although regional trade agreements were permitted under GATT s Article XXIV, such agreements contradicted GATT rules, were symptomatic of a loss of faith in liberal trade, and created rival trade blocs. This chapter examines the proliferation of regional trade agreements, including the expansion of the EEC, EFTA, the Yaound greement, and CUSFTA, and their impact on GATT. While many scholars have identified American participation in regional trade agreements in the 1980s as the moment when regional trade became a serious challenge to GATT, this chapter argues that the regional challenge began in the 1960s with agreements among smaller countries. GATT working parties reviewed all regional trade agreements, but almost never gave a verdict on whether or not they complied with Article XXIV. In effect, members denied that GATT had authority over regional trade agreements, confirming their commitment to national economic interests first and foremost. But the story is not one of complete defeat for GATT. By submitting agreements to GATT, members upheld the ideal of multilateralism and entrenched the practice and legitimacy of international accountability.
After the Second World War, the General Agreement on Tariffs and Trade (GATT) promoted trade liberalization to help make the world prosperous and peaceful. Francine McKenzie uses case studies of the Cold War, the creation of the EEC and other regional trade agreements, development, and agriculture, to show that trade is a primary goal of foreign policy, a dominant (and divisive) aspect of international relations, and a vital component of global order. She unpacks the many ways in which trade was politicised, and the layers of meaning associated with trade; trade policies, as well as disputes about trade, communicated ideas, hopes and fears that were linked to larger questions of identity, sovereignty, and status. This study reveals how the economic and political dimensions of foreign policy and international engagement intersected, showing that trade was not only instrumentalised in the service of particular policies or relations but that it was also an essential aspect of international relations.
This chapter explains the historical development of an internationalist conception of trade from Adam Smith to the 1930s. It then examines the establishment of GATT, initial reactions to the organization, and the early work of the secretariat. Efforts to establish what became GATT began during the war and involved British and American governments. The participation of other countries, including Australia, Canada, and India, also influenced the rules and purpose of GATT. The reaction to GATT showed that trade elicited divisive and polarized opinions, a trend that continued throughout its history. In its first few years, GATT had limited capabilities, but an effective secretariat led by Eric Wyndham White. This account revises the widely held view that British and American governments clashed over the postwar trade system. It challenges the belief that the USA created GATT. It shows that the GATT secretariat was proactive, committed to an internationalist trade agenda, and determined to maintain its independence.
At the Havana conference of 1947–1948, development emerged as the top priority of the International Trade Organization (ITO). But the failure to establish the ITO meant that developing countries had to work with GATT to make trade serve development goals. This chapter examines key moments (including rounds of trade negotiations, the establishment of UNCTAD, the opening of the International Trade Centre, the addition of a development chapter to the General Agreement, and the campaign to establish a New International Economic Order) and issues (such as quantitative restrictions, preferential tariffs, textiles) to try to make GATT and trade support developing countries. Clashing conceptions of development, the pursuit of individual priorities, and disagreements and rivalry among developing countries undermined efforts to reform GATT. Although developing countries have been portrayed as ill-suited to GATT, this chapter argues that they were constructive members, sometimes leaders and ultimately champions of GATT and a rules-based trade system. The story of development displaces the Cold War as the dominant framework of postwar international relations, challenges the idea of American hegemony, and reveals how GATT perpetuated a racialized global order.
Agriculture has long been a highly protected sector of trade. In the 1950s, a GATT waiver allowed the USA to protect agricultural producers and markets, setting a precedent for everyone else, and impeding efforts to liberalize agricultural trade. The challenge was compounded by the belief that agriculture was exceptional, by pressure from domestic politics and agricultural lobbies, and by the association of farm life with national identities. This chapter examines trade negotiations affecting agriculture from the Dillon to the Uruguay rounds as well as efforts to curb protectionist practices such as subsidies. Although GATT s leading members – the USA, the EEC, and Japan – all protected agricultural producers, the Common Agricultural Policy of the EEC was the most formidable obstacle to liberalizing agricultural trade. Increasingly, the USA and the EEC clashed over agriculture and some feared their dispute would cause a trade war. In the 1980s, the Cairns Group of Fair-Trading Nations, led by Australia, pushed for fair trade in agriculture. By the end of the Uruguay round, agricultural trade was being liberalized, but the reversal provoked farm protests worldwide. Agriculture challenged GATT s credibility and exposed competing liberalprotectionist imperatives and nationalistinternationalist tensions that revealed GATT s limitations and opportunities, weakness and resilience.
Despite the universal pretensions of GATT, the Cold War repositioned it geopolitically as a forum and instrument of the western alliance. The narrative follows the accession process of communist countries (Poland, Hungary, Romania, Bulgaria, Yugoslavia, the Soviet Union, and the People s Republic of China) as well as strategic allies (West Germany and Japan). Debates about admitting new contracting parties focus on GATT members that were part of the western bloc as well as ideological rivals – Czechoslovakia and the United States. The consequences of closer association or ongoing disassociation for Cold War objectives affected who was let into, allowed to associate with, or shut out of GATT. The admission of communist countries was also important to counter accusations that GATT s membership was restrictive, a claim that aggravated its institutional insecurity. Unlike many writings that have characterized GATT as apolitical, this chapter shows how the eastwest geopolitical fault line politicized and instrumentalized GATT and liberal trade.
As a powerful member of GATT, the EEC evoked fear and criticism. The EEC, especially France, in turn criticized GATT for ill-serving the interest of Europe and being a tool of the USA. This chapter examines the GATTEEC collision. The EEC tried to limit GATT s authority and proposed regional organizations such as the OECD as alternatives. However, it also supported trade liberalization, in particular during the Kennedy round of GATT talks (1964–1967). The GATT secretariat and many members tried to make the EEC observe GATT norms, rules, and practices, challenging the EEC s support for regional trade agreements and protectionist and discriminatory trade practices. This chapter argues that the EEC was both a constructive and an obstructive force in GATT. It strengthened and threatened the authority of GATT and it promoted and impeded trade liberalization. In its inconsistent support for GATT and liberal trade, the EEC was no different from other members. Because the USA supported European integration, other members stepped up to defend GATT rules and practices, revealing both the need and the opportunities for smaller countries to assume leadership positions.
The introduction situates GATT in relation to new approaches in international history and to political science literature on hegemony, trade and peace, the relationship between domestic and international spheres, and the agency of international organizations. It explains the main premise of the book – that trade is an essential component of global politics – and sets out the book s revisionist goals: to understand the role of international organizations in world affairs; rethink our understanding of the nature, drivers, and priorities of postwar international relations; and interrogate claims about the liberal global order that was established after the Second World War. Finally, it describes the four thematic case studies in the book: GATT in relation to the Cold War, the EEC and other regional trade agreements, development, and agriculture.