6.4 Uruguay Round tariff reductions
See Table 6.4 hereAbout the data
Definitions
Data sources
Countries participating in the Uruguay Round negotiations of the General Agreement on Tariffs and Trade (GATT) negotiated a new set of tariff rates covering most trade not governed by preferential trade agreements. In most cases the new tariff rates are lower than the old ones, creating new incentives for global trade. The table provides a profile of the effect of the Uruguay Round agreements on trade between high-income and developing economies.
Each country participating in the Uruguay Round agreed to bind its tariff rates at its final offer rates and to maintain its rates at or below these bound levels. The rates actually applied by countries may differ from their bound rates. Some countries bound rates at higher levels than the rates they actually applied before or after the Round. Some countries introduced unilateral tariff reductions during the Uruguay Round. And other countries entered into free trade agreements during the Round. To give a better picture of the results from the Round, the data in the table are based on applied rates and exclude reductions not conditioned on reciprocal reductions by trade partners. Trade covered by free trade agreements is also excluded.
Data on tariffs are available from the Integrated Database maintained by the GATT’s successor, the World Trade Organization (WTO), for all industrial and transition economies that participated in the Uruguay Round and 26 of the 94 developing economies that participated. The database covers 100 percent of the nonpetroleum imports of North America, Western Europe, and Central and Eastern European GATT members; 90 percent of Asia’s nonpetroleum imports; 80 percent of Latin America’s nonpetroleum imports; and 30 percent of Africa’s nonpetroleum imports.
Countries participating in the Integrated Database submitted ad valorem equivalents for most specific, compound, and mixed duties on manufactures. For agriculture and petroleum oils there are relatively few ad valorem equivalents, so caution should be used in interpreting the statistics. In addition, for some countries average tariffs and reductions may be based on a few product categories with a relatively small weight in trade.
The first two columns of the table show the percentage of imports for which tariffs were bound under the GATT before and after the Uruguay Round. The next three columns separate imports into three categories according to whether the post–Uruguay Round bindings were above, at, or below the rates applied before the Round. The share of imports for which the bound rate is below the pre–Uruguay Round applied rate is the percentage of imports for which there were tariff cuts.
Tariff bindings above applied rates cover imports under the GATT as well as under free trade agreements. For imports covered by free trade agreements the applied rate, before and after the Round, is zero, so a binding is above the applied rate for all product categories for which the bound rate is greater than zero. Similarly, a binding is at the applied rate when the bound rate is zero. The trade arrangements covered by the data are Australia–New Zealand, the North American Free Trade Agreement (NAFTA), the European Free Trade Area (EFTA), and the European Union (EU). The EU-EFTA trade arrangement does not cover agricultural goods, so agricultural imports by one EU-EFTA partner from another are treated as imports not covered by a free trade agreement.
The last six columns give weighted average tariffs and tariff reductions on imports from trade partners with which the importing country has not entered into a free trade agreement. Averages are weighted by the value of imports assessed at these rates from low- and middle-income economies and from the world.
• High-income economies included in the data set are Australia, Canada, Hong Kong, Iceland, Japan, New Zealand, Norway, Singapore, Switzerland, the United States, and the countries of the European Union.
• Low- and middle-income economies included in the data set are Argentina, Brazil, Chile, Colombia, the Czech Republic, El Salvador, Hungary, India, Indonesia, Jamaica, the Republic of Korea, Macao, Malaysia, Mexico, Peru, the Philippines, Poland, Romania, Senegal, the Slovak Republic, Sri Lanka, Thailand, Tunisia, Turkey, Uruguay, Venezuela, and Zimbabwe.
• Imports bound under the GATT are the proportion of product categories for which tariff rates were agreed and bound, before and after the conclusion of the Uruguay Round negotiations.
• Applied rates are stated as ad valorem equivalents of the most- favored-nation duty that countries charge on imports that do not receive any form of preference. Product category averages are weighted by the value of imports.
• Tariff reductions are the change in the trade-weighted applied tariff rate for the product category shown.
Data are drawn from the WTO Integrated Database, the most comprehensive source of trade and tariff statistics on the Uruguay Round. Pre- and post-Uruguay Round applied rates were calculated by J. Michael Finger, Merlinda Ingco, and Ulrich Reincke of the World Bank. See The Uruguay Round: Statistics on Tariff Concessions Given and Received (Finger, Ingco, and Reincke 1996) for detailed results for all reporting countries.
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