Define Reciprocal Trade Agreements

[3] During World War II, the Department of Foreign Affairs and other government authorities worked on plans to rebuild world trade and payments. They discovered significant gaps in the trade agreements agenda and concluded that they could make better progress through simultaneous multilateral negotiations. After the war, President Harry S. Truman used the RTAA to allow the United States to join twenty-three separate countries that negotiate bilateral customs negotiations on a product basis, with each country negotiating its concessions for each imported product with the main supplier of that product. The various bilateral agreements were grouped together in the General Agreement on Tariffs and Trade (GATT), signed in Geneva on 30 October 1947. MUTUAL TRADE AGREEMENTS. To increase U.S. exports at a time when the global depression had reduced international trade and many countries were increasing import tariffs, Franklin D. Roosevelt`s Secretary of State, Cordell Hull, convinced Congress in June 1934 to pass the Reciprocal Trade Agreements Act (RTAA). This amendment to the Smoot-Hawley Tariff Act of 1930 gave the president the power to enter into trade agreements with other nations on the basis of a reciprocal reduction in tariffs.

This marked a abandonment of the historic approach of getting Congress to set import tariffs, normally at a high level of protectionism. . . .

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