Abstract
Since World War II trade negotiations under GATT reduced tariff protection to one-eighth of its pre-war level. From the mid 1970s however, protection increased again, in particular non-tariff barriers were being used. Furthermore, strategic trade policies use subsidies and other non-border protective measures. Protection prevents the world economy from gaining full benefits from specialization combined with expansion of trade. Unlike tariffs, non-tariff barriers fragment the market and encourage a bilateral approach in negotiating trade agreements. Strategic trade policies are difficult to apply properly and may evoke retaliation. Nondiscrimination is the main principle of GATT, on which the present international trading system is based. In order to maintain it, trade negotiations under GATT will hopefully lead to international consensus on the proper use of non-tariff barriers and instruments of strategic trade policies.[/p]
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