2. Tariffs: more bindings and closer to zero
The bulkiest results of Uruguay Round are the 22,500 pages listing individual countries’
commitments on specific categories of goods and services. These include commitments
to cut and “bind” their customs duty rates on imports of goods. In some
cases, tariffs are being cut to zero. There is also a significant increase in the number of
“bound” tariffs — duty rates that are committed in the WTO and are difficult to raise.
ON THE WEBSITE:
www.wto.org > trade topics > goods > schedules of concessions on goods
www.wto.org > trade topics > services > services schedules
Tariff cuts
Developed countries’ tariff cuts were for the most part phased in over five years
from 1 January 1995. The result is a 40% cut in their tariffs on industrial products,
from an average of 6.3% to 3.8%. The value of imported industrial products that
receive duty-free treatment in developed countries will jump from 20% to 44%.
There will also be fewer products charged high duty rates. The proportion of
imports into developed countries from all sources facing tariffs rates of more than
15% will decline from 7% to 5%. The proportion of developing country exports facing
tariffs above 15% in industrial countries will fall from 9% to 5%.
The Uruguay Round package has been improved. On 26 March 1997, 40 countries
accounting for more than 92% of world trade in information technology products,
agreed to eliminate import duties and other charges on these products by 2000 (by
2005 in a handful of cases). As with other tariff commitments, each participating
country is applying its commitments equally to exports from all WTO members (i.e. on
a most-favoured-nation basis), even from members that did not make commitments.
What is this agreement called? There is no legally binding agreement
that sets out the targets for tariff reductions (e.g. by what percentage they were
to be cut as a result of the Uruguay Round).
Instead, individual countries listed their commitments in schedules annexed to
Marrakesh Protocol to the General Agreement on Tariffs and Trade 1994. This is the legally binding
agreement for the reduced tariff rates. Since then, additional commitments were made under
the 1997 Information Technology Agreement.
More bindings
Developed countries increased the number of imports whose tariff rates are “bound”
(committed and difficult to increase) from 78% of product lines to 99%. For developing
countries, the increase was considerable: from 21% to 73%. Economies in
transition from central planning increased their bindings from 73% to 98%. This
all means a substantially higher degree of market security for traders and investors.
ON THE WEBSITE:
www.wto.org > trade topics > market access for goods
> See also Doha Agenda negotiations
2. Tariffs: more bindings and closer to zeroThe bulkiest results of Uruguay Round are the 22,500 pages listing individual countries’commitments on specific categories of goods and services. These include commitmentsto cut and “bind” their customs duty rates on imports of goods. In somecases, tariffs are being cut to zero. There is also a significant increase in the number of“bound” tariffs — duty rates that are committed in the WTO and are difficult to raise.ON THE WEBSITE:www.wto.org > trade topics > goods > schedules of concessions on goodswww.wto.org > trade topics > services > services schedulesTariff cutsDeveloped countries’ tariff cuts were for the most part phased in over five yearsfrom 1 January 1995. The result is a 40% cut in their tariffs on industrial products,from an average of 6.3% to 3.8%. The value of imported industrial products thatreceive duty-free treatment in developed countries will jump from 20% to 44%.There will also be fewer products charged high duty rates. The proportion ofimports into developed countries from all sources facing tariffs rates of more than15% will decline from 7% to 5%. The proportion of developing country exports facingtariffs above 15% in industrial countries will fall from 9% to 5%.The Uruguay Round package has been improved. On 26 March 1997, 40 countriesaccounting for more than 92% of world trade in information technology products,agreed to eliminate import duties and other charges on these products by 2000 (by2005 in a handful of cases). As with other tariff commitments, each participatingcountry is applying its commitments equally to exports from all WTO members (i.e. ona most-favoured-nation basis), even from members that did not make commitments.What is this agreement called? There is no legally binding agreementthat sets out the targets for tariff reductions (e.g. by what percentage they wereto be cut as a result of the Uruguay Round).Instead, individual countries listed their commitments in schedules annexed toMarrakesh Protocol to the General Agreement on Tariffs and Trade 1994. This is the legally bindingagreement for the reduced tariff rates. Since then, additional commitments were made underthe 1997 Information Technology Agreement.More bindingsDeveloped countries increased the number of imports whose tariff rates are “bound”(committed and difficult to increase) from 78% of product lines to 99%. For developingcountries, the increase was considerable: from 21% to 73%. Economies intransition from central planning increased their bindings from 73% to 98%. Thisall means a substantially higher degree of market security for traders and investors.ON THE WEBSITE:www.wto.org > trade topics > market access for goods> See also Doha Agenda negotiations
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