Kennedy Round

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Kennedy Round
StatusComplete
Genre
Trade Round
Begins1964
Ends1967
Location(s)Geneva
CountrySwitzerland
Previous eventDillon Round
Next eventTokyo Round
Participants62 [1]

The Kennedy Round was the sixth session of

Palais des Nations. Despite several disagreements over details, the director general announced the round's success on May 15, 1967, and the final agreement was signed on June 30, 1967—the last day permitted under the Trade Expansion Act. The round was named after U.S. President John F. Kennedy, who was assassinated six months before the opening negotiations.[2]

The main objectives of the Kennedy Round were to:

  • Slash tariffs by half with a minimum of exceptions
  • Break down farm trade restrictions
  • Remove
    non-tariff barriers
  • Help developing countries

History

Background

The European trade integration signaled by the creation of the

Treaty of Rome led the United States to fear its own products would be shut out of the European market.[3][4] Thus, President Kennedy pressed for the passage of the Trade Expansion Act, which gave the president authority to decrease duties up to 50% from their 1962 levels or increase them up to 50% from their 1934 levels. The window for this increased authority was after June 30, 1962, and before July 1, 1967.[5] Trade adjustment assistance was considered within the act with several provisions that provided for the financial and technical assistance to firms and workers adversely affected by the opening of trade.[6] It also made provisions for treating the EEC as a single trade partner and made special provisions for any trade agreements covering agricultural commodities.[7]
After the act was passed, the administration pressed for a new round of multilateral trade talks to utilize its new authority, which would become known as the Kennedy Round upon the death of President Kennedy in November 1963.

Negotiations

The Kennedy Round officially opened on May 4, 1964, at the

Lyndon Johnson had little chance of success in reauthorizing the Trade Expansion Act, its July 1, 1967 deadline served as the effective deadline for the Kennedy round.[10] After a marathon session, negotiators announced a satisfactory agreement at a midnight meeting with the press on May 15, 1967. The final agreement was signed on June 30, 1967. However, within the United States, Congress repealed several provisions of the round of global tariff cuts, hurting the future credibility of the United States in worldwide trade negotiations.[12]

Effects

U.S. tariff concessions involved $8.5 billion worth of goods, and foreign tariff concessions on imports from the United States involved $8.1 billion. 64% of non-agricultural dutiable imports were covered by U.S. linear cuts, with an average tariff reduction of 35%. Foreign tariff reductions were on average 34%, and covered 48% of their non-agricultural dutiable imports.[10] Non-tariff achievements included the establishment of the GATT Antidumping Code of 1967, which gave a procedural framework for negotiating dumping accusations and expanded upon the original Article VI in GATT.[13] The round can also be seen as a success for developing nations. A "Trade and Development" section was added to the GATT charter; its most significant feature was exempting developing nations from the rule of reciprocity. It also called for the stabilization of raw material prices.[14] Further, the agricultural grains arrangement provided for higher minimum trading prices as well as a food aid program to developing countries.[15] Some progress was also made with negotiations on commodities. The round extended the Long Term Cotton Textile Arrangement for another three years and provided frameworks for negotiating steel, aluminum, chemicals, pulp, and paper tariffs.[15]

Criticism

General protectionist criticisms have been made of the round. In voting to withdraw from the

WTO in 2000, Congressman Jack Metcalf cited the Kennedy round as the beginning of "the slow decline in Americans’ living standards" and that all such multilateral agreements "may mesmerize and motivate Washington policymakers, but in the American heartland...translate as further efforts to promote international order at the expense of existing American jobs".[16] However, the round also has economically liberal critics, who believe that it did not achieve as liberal of goals as the tariff cuts suggest and instead, out of political fears, erected non-tariff barriers to protect domestic industries from the negative effects of trade.[17]

References

  1. ISBN 9780136892410. Retrieved 4 February 2024.{{cite book}}: CS1 maint: location (link
    )
  2. ^ "GATT and the Kennedy Round" (PDF). Central Intelligence Agency. Archived from the original (PDF) on January 23, 2017.
  3. ^
    ISBN 978-0-387-22685-9
    .
  4. ^ a b The World Trade Organization: legal, economic, and political analysis, Vol. 1. Patrick Macrory, Arthur Appleton, Michael Plummer.
  5. ^ 19 USC Chapter 7 - Trade Expansion Program Archived 2011-02-03 at the Wayback Machine. 1 February 2010.
  6. ^ US Code Title 19, Chapter 7, Subchapter III. Tariff Adjustment and Other Adjustment Assistance.
  7. ^ US Code Title 19, Chapter 7, Subchapter II. European Economic Community (repealed).
  8. ^ "Trade Promotion Authority and the Role of Congress in Trade Policy", 8 February 2008.
  9. ^ WTO, "Anti-Dumping Definition".
  10. ^ a b c d Bernard Norwood, "The Kennedy Round: A Try at Linear Trade Negotiations", Journal of Law and Economics, Vol. 12, No. 2 (Oct. 1969), pp. 297-319
  11. ^ "World Trade: Toward the Kennedy Round", Time Magazine. 6 March 1964.
  12. ^ "The Cafta Conundrum", The Economist, 16 June 2005.
  13. ^ [1] Overview and Compilation of U.S. Trade Statutes. June 2001.
  14. ^ [2] international trade. Encyclopædia Britannica Online School Edition. 2011. Web. 28 Feb. 2011
  15. ^ Jack Metcalf, "Speech to Congress on H.J. Res 90", 4 May 2000
  16. The American Economic Review
    ,

Further reading

  • Evans, John W. The Kennedy Round in American Trade Policy: The Twilight of the GATT (1971)
  • Lee, Donna. "Endgame at the Kennedy Round: a case study of multilateral economic diplomacy." Diplomacy and Statecraft 12.3 (2001): 115–138.
  • Marvel, Howard P., and Edward J. Ray. "The Kennedy round: evidence on the regulation of international trade in the United States." American Economic Review 73.1 (1983): 190–197. argues US firms that were hurt got special protection from Congress.
  • Rehm, John B. "Developments in the law and institutions of international economic relations: the Kennedy Round of Trade Negotiations." The American Journal of International Law 62.2 (1968): 403–434.
  • Zeiler, Thomas W. "Commanding the Middle: The American Agenda at the Kennedy Round" Australian Economic History Review. (2001) 41#3 p308-24. online

External links

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