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Trade In Industrial Products - The Cornerstone of Global Trade
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Freer Trade in Industrial Products |
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Since the General Agreement on Tariffs and Trade (GATT) was created in 1947, successive rounds of trade liberalization have focused on cutting tariffs on industrial goods yielding impressive results. World trade grew from $80 billion in 1947 to $9 trillion today. In the last decade alone, implementation of the Uruguay Round produced a 50 percent increase in trade in goods.
There is more work to be done, however. Trade in industrial products accounts for more than three-quarters of global trade. The United States is very open to imports with an average tariff rate of 3 percent. This is good for U.S. consumers who enjoy a growing variety of goods at lower prices.
At the same time, however, U.S. manufactured goods still face an average tariff of 30 percent in other markets. A decrease in tariffs by even one-third could generate an increase in global economic welfare of $267.3 billion with most of those gains accruing to developing countries. Elimination of all tariffs on consumer and industrial goods could increase the U.S. national income alone by as much as $95 billion.
To achieve immediate results, ABCDoha strongly supports the pursuit of sectoral arrangements among a critical mass of countries who agree to go further faster by offering each other zero tariffs on a reciprocal basis, especially on highly-traded goods.
U.S. producers export more than $670 billion each year in consumer and industrial goods, supporting more than 12 million high-paying U.S. jobs. Generating increased U.S. exports requires doing more than reducing and eliminating tariffs. That is because where tariffs have come down non-tariff barriers have taken their place, inhibiting further expansion of the U.S. market share around the world.
ABCDoha therefore also places a high priority on addressing non-tariff barriers to industrial products in the Doha Round. Non-tariff barriers range from import licensing requirements and uneven regulations to restrictions on foreign investments, all of which may unfairly discriminate, raise costs, and impede market access for U.S. products.
Much of the groundwork has been completed. We call on leaders to reach agreement on a robust tariff-cutting formula for all industrial and consumer products, to pursue actively sectoral agreements for immediate results, and to propel forward work on non-tariff barriers so that real gains in market access may be achieved.
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