A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Saxena, Sada Shankar Article — Digitized Version The Uruguay Round: Expectations of developing countries Intereconomics Suggested Citation: Saxena, Sada Shankar (1988) : The Uruguay Round: Expectations of developing countries, Intereconomics, ISSN 0020-5346, Verlag Weltarchiv, Hamburg, Vol. 23, Iss. 6, pp. 268-276, http://dx.doi.org/10.1007/BF02925124 This Version is available at: http://hdl.handle.net/10419/140157 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. 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Are the Uruguay Round negotiations likely to bring positive results for the developing countries? ever before has the world trading community been political research, and that this deficiency can be traced N as concerned about the international trading back to a lack of conceptualisation? environment and the rules of the game as now, during As for the international trading environment, analysts the current round of multilateral trade negotiations observe that by the mid 1980s a substantial erosion of (MTNs), the Uruguay Round. the will of the international community to address itself to The countries which participated in the building of a the needs of the economic development of the new international order at the Bretton Woods developing countries had taken place? Conference did so on the basis of a consensus that the Many thinkers from the developed world express the market mechanism should be restored in all countries opinion that from 1985 onwards there has been a and in the international economy. Trade should be open turning-point in the world economy. They state that the and free, and the same should apply to international worst of the economic crisis seems to be over and capital and monetary flows. However, in the 1970s the economic recovery is spreading, leading to an Bretton Woods system broke down due to a lack of expansion in the volume, as well as the value, of economic and monetary discipline in both the USA and international trade. Western Europe. The breaking point was the unilateral American decision to suspend the free and mutual However, analysed from the developing countries' exchange between gold and the dollar, the main link in point of view, it cannot be considered to be a real the monetary system. Apart from this monetary crisis, a recovery for the global economy, since the economic sizeable increase in oil prices also took place, which recovery starting with the United States spread only to shocked the world economy and led to an awareness countries like Japan and Western Europe and a few that the old system did not work any more and that a new countries in Asia. In other words, the recovery has not at one had to be found. all been world-wide nor is it likely to become. It has, in fact, led to increasing difficulties for the developing Interestingly enough, this somewhat belated countries. For the first time since the 1930s, economic recognition of the interplay between economic and recovery is paralleled not by an increase but by a political forces and the concept of implicit decrease in commodity prices. Many commodity prices "interdependence" is, in a way, a far cry from the are currently at their lowest level since the 1930s. perceptions of the "beggar my neighbour" policy era. Further, the developing countries are increasingly facing Talking of interdependence, it has been felt by some to the challenges of protectionism, reducing their access be rather surprising that such international interdependences are seldom topics of economic and 1 Cf. W. B & r t s c h i : Dependencies and Inter-dependencies: A Theoretical Comment, in: INTERECONOMICS, No. 9-10, 1978, pp. 246- 250. * Indian Institute of Foreign Trade, New Delhi, India. The views expressed in this article reflect the personal opinion of the author. 2 UN Expert Group: Development in Siege, NewYork 1987. 268 INTERECONOMICS, November/December 1988 GATI" to the most prosperous markets in the world. Despite the trading. The utter disregard for GATE rules shown by trend for progressive tariff-dismantling by the developed some of the developed countries and the imposition of countries, the proliferation of non-tariff barriers has various trade-restrictive or distortive measures - either further intensified their difficulties. unilaterally or, as in many cases, negotiated bilaterally It is against this background that the new round of outside the multilateral framework of GATT norms, rules GATT negotiations must be assessed by the developing and procedures - glaringly manifest the increasing loss countries. It is ironic that under the new GATT round the of GATT control over the trade policies and practices of trade negotiations are, for the first time, demanding the its member countries. The world trading environment opening up of the markets of the developing countries has been continuously deteriorating on account of for the products of export interest to developed yawning trade deficits and persisting balance of countries. In other words, the Western World is payments disequilibria in many developed and demanding access to markets in the South rather than developing countries. Widely fluctuating exchange the other way around. Although developing countries rates, varying inflationary spirals, concomitant with were the greatest victims of protectionism in the 1980s, unemployment problems, have been affecting they are likely to be pressurised to open up their markets adversely the scope for free multilateral trading. for new products in new sectors - service sectors and Furthermore, increasing disharmony among the high technology - which developed countries consider monetary, fiscal and trade policies of different countries to have maximum potential. The new round thus has had a worsening impact on the harmonious flow of threatens to establish the international trade and resources between them. Before such a backdrop, the economic system more on the terms of the richer and efforts for the revival of free multilateral trading, which more powerful countries without any real perspective for the new round has been striving for, have justifiably the developing countries. accorded unprecedented eminence to this set of MTNs. Launching of the Round Main Planks The Uruguay Round, the eighth in the series of The main planks of the Uruguay Round from the point multilateral trade negotiations under the auspices of of view of the developing countries are: the problems GATT, has assumed unprecedented importance owing faced in accelerated implementation of theTokyo Round to its extensive objectives, wide coverage and elaborate results, in the areas of tariff, para-tariff and non-tariff general principles, evolved to govern the modalities of measures; the unfinished tasks of the Tokyo Round such negotiations in a host of areas, traditional as well as as the proper formulation of codes on "safeguards" and entirely new ones. The subjects of negotiation under this "dispute settlement procedures"; the effective tackling Round are listed in the Ministerial Declaration of of problems of trade in sectors of export interest to September 20, 1986, which comprises two parts: Part I developing countries; problems of trade in agricultural relates to trade in goods including trade-related aspects products; and, most significantly, the objectives of intellectual property rights and trade-related specified and the areas delineated in the Work investment measures and Part II specifies negotiations Programme by the Ministerial Declaration in 1982. for trade in services. Pressure from the United States, The main elements of the preamble to Part I of the backed by a few other developed countries, opposing Uruguay Round Declaration relating to Negotiations on the emphasis laid by the developing countries on the Trade in Goods are: implementation of the Ministerial Work Programme of 1982 and the completion of unfinished tasks of the Tokyo [] halting and reversing protectionism, Round before taking up an altogether new area for negotiations, attracted world-wide attention at the [] removing distortions to trade, preliminary stages long before the preparatory