32 terms

CH. 5 MGT 450


Terms in this set (...)

A series of rules governing trade that were first created in 1947 by twenty-three countries
what does GATT stand for
general agreement on tariffs and trade
Most-favored-nation clause (MFN)
A GATT provision that required member countries to automatically extend to all member countries the same benefits, usually tariff reductions, they agreed on with any other countries
No nation really has a favored nation status
All nations that trade interact with each other as a normal part of global trade
when did the world trade organization come about
-organization that succeeded GATT and came into effect on January 1, 1995
What is the wto primary purpose
to serve as a negotiating forum for member nations to dispute, discuss, and debate trade-related matters
what Is the current round of wto
the Doha Round and began in 2001
how many countries are involved in wto
at least 157 countries
The appropriation of the knowledge and genetic resources of farming and indigenous communities by individuals or institutions that seek exclusive monopoly control (patents or intellectual property) over these resources and knowledge"
biopiracy example
amazon: Ayahuasca
spellbound flowers
The indigo-eating enzyme jeans
environmental goods agreement
Proposed agreement that would cover more than 85% of global production of solar panels, wind turbines, water treatment filters, and similar goods
• United States, Australia, Canada, China, Costa Rica, EU, Hong Kong, Japan, Korea, New Zealand, Norway, Singapore, Switzerland, Chinese Taipei (Taiwan), Israel, Turkey, Iceland
regional economic integration
enabled countries to focus on issues that are relevant to their stage of development as well as encourage trade between neighbors
four main types of regional economic integration
Free trade area
— Customs union
— Common market
— Economic union
pros of creating regional agreements
Trade creation • Employment opportunities • Consensus and cooperation
cons of creating regional agreements
Trade diversion
• Employment shifts and reductions
• Loss of national sovereignty
Agriculture • Non-agricultural market access (NAMA) • Services • Trade facilitation • Anti-dumping • Subsidies and countervailing measures • Fisheries subsidies • Regional trade agreements • The natural environment • Wines and alcoholic spirits • Intellectual property issues • Biopiracy
The term MFN is being deprecated or replaced by what?
or replaced by PNTR or normal trade relations
Change was made in the USA in 1998
countervailing measures
measures that can be undertaken whenever an investigation, by the investigating authority of the importing country, has led to the determination that the imported goods are benefiting from subsidies, and that they result in an injury
Major Areas of Regional Economic Integration and Cooperation North America: NAFTA
It came into being during a period when free trade and trading blocs were popular and positively perceived
— Its goal has been to encourage trade between Canada, the United States, and Mexico
South America: MERCOSUR
— The group has been strategically oriented to develop the economies of its constituents, helping them become more internationally competitive so that they would not have to rely on the closed market arena
— It has brought nations with long-standing rivalries together
— It is committed to the consolidation of democracy and the maintenance of peace throughout the southern cone
Other trade agreements in the Americas
CARICOM and Andean Community CAFTA-DR
Europe: EU
Most integrated form of economic cooperation The Treaty of Maastricht in 1993 - The real economic union was created
— Primary focus is on economic, social, cultural, and technical cooperation as well as promoting regional peace and stability
— Only regional trading group that uses the term member economies, rather than countries, in deference to China
Middle East and Africa: GCC
— As a political and economic organization, the group focuses on trade, economic, and social issues
Middle East and Africa: AEC
An organization of the African Union states — Provides for a staged integration of the regional economic
How Do These Trade Agreements and Efforts Impact Business?
Global businesses have benefited from the regional trade agreements by having more consistent criteria for investment and trade as well as reduced barriers to entry

• The challenges for businesses include finding themselves outside of a new trading bloc or having the "rules" for their industry change as a result of new trade agreements
The United Nations and the Impact on Trade
Global businesses find that operating in stable environments leads to the best business operations for the following reasons:
— Staffing
— Operations
— Regulations
— Currency convertibility and free-flowing capital
when was the UN formed
was formed in 1945 at the end of World War II to replace the League of Nations, which had been formed in 1919
UN original goals
To maintain international peace and security
— To develop friendly relations between nations
— To foster international cooperation in solving economic,
social, humanitarian, and cultural issues
UN consists of ..
General Assembly
— Security Council
— Economic and Social Council (ECOSOC)
— Secretariat
— International Court of Justice
— UN trusteeship Council
UN as a Business Partner
UN works closely with the private sector
• Global businesses sell to the UN just as they do to their own governments and public-sector organizations
• Each arm of the UN has a procurement office
• The UN Procurement Division does business with vendors from all over the world
— Actively working to increase its sources of supply from developing countries and countries with economies in transition