...International Operations Management The new role of WTO as a World trade court 1957 : GATT General Agreement on Tariff and trade 23 countries only when Gatt was created. A club of countries dominated by US. Major discussions on tariff reductions : KENNEDY ROUND NIXON ROUND Try to reduce the tariff among countries. 1990 : URUGAY ROUND Decision to convert GATT Into a more formal organzation 1995 : creation of WTO = World Trade Organization 125 countries Involved in four new fields : Financial services Telecommunications Shipping Business Services China becomes a member in 2001 Russia becomes a member in 2011 Today 154 countries which report over 97% of world trade Some outsiders : NORTH KOREA WTO : Two groups of countries Faborable to free trade Attracted by protectionism Free trade theory and deregulation * Free trade theory : Countries who think that global production will increase if countries do not interfere directly to affect trade. * Deregulation policy : Removal of government interference Ex : USA air transportation Protectionism and infant-industry policy * Protectionism : Government restrictions on imports that frequently give direct or indirect subsidies to industries to enable them to complete with foreign production * Infant-industry policy : An emerging industry should be guaranteed o large share of the domestic market until it becomes efficient enought to complete against imports...
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