the World Marketplace
R. D. Knutson
From a US perspective, the General Agreement on Tariffs and Trade (GATT) led to a clear set of winners including primarily the wheat, feed grain, oilseed and livestock sectors. The benefits to these sectors result from income enhancement, particularly in developing country sectors. For example, the wheat sector benefits because of anticipated reductions in European Union ( EU) subsidies. Dairy, cotton, rice, tobacco, peanuts and sugar stand to be the primary losers. However, trade irritants between the United States and Canada may well have been increased as a result of the North American Free Trade Agreement (NAFTA), Canada-United States Trade Agreement (CUSTA), and GATT. In the long run, continued movements in the direction of free trade will require adjustments in marketing board and supply management policies. Movements toward regional trading blocs could be anticipated as an alternative to generally freer trade.
This chapter provides an assessment of the impact that GATT has had on some of the major traded commodities. There are winners and losers, but certain large commodity sectors, such as US peanuts, remain highly protected. The same is true, however, for supply-managed commodities, such as the chicken and dairy industries in Canada.
Making a post-GATT assessment of the world marketplace is not an easy task. Virtually every government has made its own assessment of the impacts of GATT, each with a spin designed to put its best light on the agreement. Perhaps not surprisingly, the United States Department of Agriculture ( USDA) study found no negative impacts on US agriculture ( March, 1994) -- a result that could have been intended to increase the