WTO and the multilateral trade system

Sweden is a member of the World Trade Organization (WTO), the leading multilateral trade policy forum and successor to GATT. Sweden became a signatory to GATT as early as 1950. The multilateral trading system was subject to heavy pressures during the global recession of the early 1980s. This was an important reason for Sweden being an early supporter of plans for a new round of negotiations aimed at strengthening GATT, halting protectionist trends and contributing to further trade liberalization.

The Uruguay Round – the eighth major “round” in GATT history – was launched at Punta del Este, Uruguay, in September 1986. After more than seven years of negotiations, it ended in December 1993. One result of the negotiations, which strengthens and extends the multilateral trading system, was an agreement to establish the WTO, which went into effect on January 1, 1995.

In December 1996 the WTO held its first regular ministerial meeting in Singapore. The organization successfully reached an information technology agreement, which will be of great importance to the growing trade in IT products.

In 1997 important agreements were concluded in the areas of basic telecommunication services and financial services.

The second WTO ministerial meeting was held in Geneva in May 1998. The WTO General Council was mandated to start preparations for decisions to be taken on further multilateral trade negotiations. A decision to this end is expected at the next WTO ministerial meeting in the USA at the end of 1999.

The establishment of the WTO marks a new era in multilateral trade cooperation. The WTO constitutes a common, uniform framework of multilateral trade relations. Its policies will enhance the political importance of these relations because of its close ties with the World Bank and the International Monetary Fund. Furthermore, the WTO has recognized the importance of the environment for the first time in the context of multilateral trade rules.

From Sweden’s point of view, the overall outcome of the Uruguay Round was highly satisfactory. For example, sizable reductions of tariffs and other trade barriers will give Swedish exports better access to a number of important markets. The Agreement on Agriculture is pioneering, since it is the first time that agricultural trade has been seriously integrated into the multilateral system. Another example is that current quotas for textiles and clothing are to be phased out over a ten-year period.