Having already established the International Monetary Fund
and the precursor to the World Bank, the United States and its
allies create the General Agreement on Tariffs and Trade (GATT)
to bolster free trade. GATT is intended to be a stopgap measure
on the way to forming the International Trade Organization.
Twenty-three countries ratify GATT. It is formally established
The U.S. Congress refuses to ratify a treaty establishing
the International Trade Organization. Although some 50 countries
ratify the ITO's charter, the project dies, giving GATT a de facto
extension from its provisional nature.
An important round of discussions begins in Punta del Este,
Uruguay, as ministers agree to a new negotiating agenda, including
discussions on extending GATT's trading system to cover trade
in services and intellectual property. The Uruguay Round results
in the largest negotiating mandate on trade ever completed.
After several ministerial meetings, GATT members continue to negotiate
trading rules in areas such as agriculture, services and market
access. Members debate the creation of a new institution to take
on trade decisions on a more permanent basis. Ministers from most
of the 125 governments participating in GATT sign a deal in April
that creates the World Trade Organization -- a group with its
own secretariat and the ability to make permanent commitments.
All previous commitments under GATT had been applied on a provisional
The World Trade Organization begins to operate, based in
Geneva, Switzerland. Central to the organization's operation is
a 1994 amended version of GATT updated to include areas such as
WTO members discuss telecommunications issues at a meeting
in February, with 69 governments agreeing to liberalization measures.
Later in the year, 40 governments negotiate for tariff-free trade
of information technology products and 70 governments finish a
financial services deal.
Delegates at a December summit of the WTO in Seattle fail
to begin a new series of trade negotiations. Many blame the disintegration
of the talks on massive protests outside the conference,
as well as strong divisions between industrialized and developing
nations. Issues such as agriculture subsidies, the environment,
intellectual property, labor standards and the WTO's membership
remain unresolved. Thirty-one governments, including the People's
Republic of China, continue to wait for consideration for WTO
WTO issues several reports and rules on a number of international
disputes involving both developing and industrialized countries,
over such issues as patent protection and steel dumping. Steps
are also taken toward China's membership, which relies greatly
on trade normalization between China and the United States. Five
other countries are granted membership, bringing WTO membership
The Fourth Ministerial Conference is held in Doha, Qatar,
where China is admitted as the 143rd member of the WTO, despite
controversy surrounding its human rights record. At the conference,
the United States, Europe and Japan are pressured to remove domestic
protections for their agricultural industries in order to facilitate
the economies of many developing countries. Also during the conference,
the United States blocks a proposal to help developing countries
buy cheap drugs to fight AIDS and other diseases.
The WTO fields complaints from eight members against the United
States concerning steel dumping and protections. Verdicts on the
steel dispute are issued over 2002 and 2003, but are either ignored
or appealed. The European Union, one of the lead members in the
complaints against the United States, threatens to increase tariffs
on U.S. imports.
Negotiations at the Fifth Ministerial Conference in Cancun, Mexico
in September collapsed after delegates from developing countries
walked out over disagreements on agricultural reform. During the
talks, the G20 developing country alliance, led by Brazil and
India, emerged as a major negotiating force.
WTO delegates missed the Jan. 1, 2005 deadline to conclude the
Doha Round of negotiations, pushing the date unofficially to the
end of 2006.
Trade representatives will meet in Hong Kong in December for the
Sixth Ministerial Conference to continue negotiations in the Doha
Development Agenda to lower trade barriers in farm and manufacturing
goods and services with a focus on developing