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Free Trade Agreements and the WTO (PowerPoint)

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No Slide Title Free Trade Agreements and the WTO Paul Drazek DTB Associates, LLP 2010 Agricultural Outlook Forum Friday, February 19, 2010 Crystal Gateway Marriott GATT (Now the WTO) Created After World War II Why? To try to end the anarchy in international trade that existed prior to the War. – Essentially no international rules prior to 1948 – Tariffs could be changed at will (Smoot Hawley) – Widespread use of non-tariff barriers (NTB’s) – Discrimination among countries through preferential trade deals GATT Article I “Most Favored Nation” Principle -- Treat All Other GATT (WTO) Members Alike. But Article XXIV allows exceptions for Free Trade Agreements (FTA’s) and Customs Unions under certain circumstances. Relatively few FTAs globally prior to 2000. U.S. had just Israel, Canada, and then NAFTA. US Policy Has Driven Growth in FTAs • Proliferation of FTAs began in earnest with U.S. policy of “competitive liberalization.” – Expand trade policy beyond global trade agreements to regional and bilateral deals and use with WTO to expand trade liberalization. – Example: Expand NAFTA leads to FTAA/APEC leads to global deal in WTO. – At least, that was the theory. US Started Strong, But Not Much Recently FTA Year Negotiations Initiated Date Entered into Force Israel FTA 1984 9/1/85 Canada FTA 1986 1/1/89 NAFTA 1991 1/1/94 Jordan FTA 2000 12/17/01 Singapore FTA 2000 1/1/04 Chile FTA 2000 1/1/04 Australia FTA 2003 1/1/05 Morocco FTA 2002 1/1/06 Bahrain FTA 2004 8/1/06 El Salvador - CAFTA 2003 3/1/06 Honduras - CAFTA 2003 4/1/06 Nicaragua – CAFTA 2003 4/1/06 Guatemala – CAFTA 2003 7/1/06 Dominican Rep - CAFTA 2003 3/1/07 Costa Rica – CAFTA 2003 1/1/09 Oman FTA 2005 1/1/09 Peru 2003 2/1/09 Colombia 2004 [signed 2006] Panama 2004 [signed 2007] Korea 2006 [signed 2007] Trade Agreements No Longer in Vogue • Political opposition to trade agreements in the U.S. limited negotiations: FTAA and APE

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