GATT and the Developing Countries

Wednesday, January 1st, 1992 at 12:00 am by Robert E. Hudec
Robert E. Hudec, GATT and the Developing Countries, 1992 Colum. Bus. L. Rev. 67

The relationship between the General Agreement on Tariffs and Trade (“GATT”) and its developing country members is currently undergoing a period of major change. Indeed, negotiations have reached a crisis point. In order to understand the present situation, a review of the relationship’s history is essential.

During the first thirty-five years of GATT’s existence, from about 1946 until 1981, the developing countries’ relationship with the GATT was characterized by a progressive effort to acquire preferential treatment rights. The basic rationale underlying this effort was that poorer countries should receive more favorable treatment than wealthier nations. The specific type of favorable treatment requested has varied in emphasis over time, but developing countries’ demands have consistently included the same major elements, collectively referred to as “special and differential treatment” or “S & D treatment.” First, developing countries have requested: 1) legal freedom to impose trade barriers prohibited by GATT, such as quota restrictions and bound tariffs; and 2) legal freedom to discriminate in favor of other developing countries to the disadvantage of wealthier ones.

Second, developing countries have requested that developed countries: 1) be obliged to grant, without any reciprocal concessions from developing countries, reductions in tariffs and other trade barriers of commercial interest to developing countries (the “non-reciprocity principle”); and 2) be obliged to discriminate in favor of developing countries by according them tariff preferences or preferential access under other trade barriers.

Author Information

Melvin C. Steen Professor of Law, University of Minnesota Law School