The Gatt Deal: World waits to see who really gains: It took seven years to work out an agreement, but no one knows how long will it take to work out the consequences

WHO are the real winners and losers after yesterday's Gatt deal?

On one side, those like Peter Sutherland, the Gatt Director-General, say the deal will give a badly needed boost to the world economy and create millions of jobs in the industrialised world. On the other are critics and interest groups who fear it will lead to a massive haemorrhaging of skilled jobs from Europe to the low-wage economies of the Far East and elsewhere.

Others say the deal will speed up the damage to the environment by promoting industrialisation and making it more difficult to protect the environment through trade restrictions.

The Uruguay Round of negotiations on the General Agreement on Tariffs and Trade - the largest and most comprehensive to date - has been a seven-year marathon, finishing three years late.

The main beneficiaries will be export-driven businesses, many of them large transnational corporations. Duties paid at borders, the subsidies paid to competitors and many other barriers to trade will be reduced or eliminated, making world trade more competitive. But whether the deal will deliver the much-quoted pounds 143bn in additional annual world income remains to be seen.

The agreement will extend the scope, the scale and the authority of the world's commercial system, which should in turn bring down prices, boost trade and create jobs. Exporters of top European products - everything from quality French cheeses to Scottish whiskies and hi-tech goods - should find formerly inaccessable international markets opening up.

The agreement has been hailed by the Bureau of European Consumer Union (BEUC) as important for consumers in wealthy countries because it will give them 'greater choice and lower prices'. Consumers in poorer countries will benefit, the organisation says, 'from increased access to work in agriculture and industry, which is essential if they are to meet their basic needs.'

'We're not going to wake up tomorrow and find cheaper foods in our supermarkets,' said a spokeswoman, Victoria Graham, but over a period of years 'electronic goods will be up to 20 per cent cheaper, foods will be cheaper and a Japanese car could cost up to pounds 1,000 less than at present.' It will take up to 10 years for the present voluntary restraints on Japanese car imports to Europe and the US to go altogether.

Mr Sutherland has also taken up the cudgels on behalf of consumers. 'The effects of protection almost always fall most heavily on the poorest sections of society,' he said. 'It is they who, because of low income, have to spend the highest proportion of their household budget on necessities like clothing, footwear and basic food products.'

Two trenchant critics of the Gatt deal are Tim Lang, Director of Parents for Safe Food and Colin Hines, co-authors of The New Protectionism. Mr Hines believes that Gatt will lead to more unemployment in Europe as jobs go to cheaper-waged, more competitive economies with lower environmental and welfare standards.

'Some Europeans may get wealthier from a Gatt, but what good is that if more are out of work?' he asks. The prime beneficiaries of a free-trade deal he says, are the world's 35,000 transnational corporations, more than half of which are based in the US, Japan, Germany and Switzerland, according to the United Nations.

The most important part of any Gatt agreement has always been commitments on market access - the amount by which countries cut their tariffs on certain goods. Tariffs are to be cut from an average five per cent to three per cent, reducing the cost of products in the shops - if importers pass on the difference. In seven rounds of talks since 1948, tariffs have come down some 45 per cent.

But the achievement of this agreement, and its most difficult task, was to bring agriculture under the rules of the world trade system. Subsidies are to be brought down by 21 per cent over six years. In Europe, last year's redesign of the Common Agricultural Policy has already determined changes in subsidies, and one of the hardest fights was persuading France that CAP reform and the Gatt were compatible. Nonetheless, most studies suggest that the CAP will need a revamp in coming years.

Textiles, long one of the most protected sectors in the world trading system, will be revolutionised as quotas are removed over 10 years, and the cost of basic clothing items should slide. For many developing countries, this was the quid pro quo for the demands made of them in areas like services. It will hit textile-producing countries like Portugal hard.

Services - everything from telephone links to the sale of insurance policies - are a key feature of the deal for the developed countries, and those in Europe in particular. The EU - especially France and Britain - is a services superpower. But the financial services package produced in Geneva is weak: other areas, like shipping, have barely been touched or put to one side.

Perhaps the most important result of agreement, however, will be to instil greater order in the world trade system. For Europe, which is highly dependent on external trade, this is vital.

Despite its impressive scope, the final deal was more conservative than originally expected when the round began in the warm sunshine of Punta del Este in Uruguay back in 1986. Several sectors have fallen out of the deal, or were never in it, or were weakened or simply side- tracked, such as trade in audiovisual products, steel, aircraft subsidies and financial services.

News
Actor Burt Reynolds last year
peopleBurt Reynolds, once among the most bankable actors in Hollywood, is set to auction his memorabilia
News
Gordon and Tana Ramsay arrive at the High Court, London
newsTV chef gives evidence against his father-in-law in court case
News
people

Watch the spoof Thanksgiving segment filmed for Live!
News
The data shows that the number of “unlawfully” large infant classes has doubled in the last 12 months alone
i100Mike Stuchbery, a teacher in Great Yarmouth, said he received abuse
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksNow available in paperback
Arts and Entertainment
The starship in Star Wars: The Force Awakens
filmsThe first glimpse of JJ Abrams' new film has been released online
Arts and Entertainment
The cover of The Guest Cat – expect to see it everywhere
books'It's a simple, sweet and charming tale; it’s very heartfelt'
News
i100 Charity collates series of videos that show acts of kindness to animals
Arts and Entertainment
One of the installations in the Reiner Ruthenbeck exhibition at the Serpentine Gallery
artCritics defend Reiner Ruthenbeck's 'Overturned Furniture'
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Opilio Recruitment: UX & Design Specialist

£40k - 45k per year + Benefits: Opilio Recruitment: A fantastic opportunity ...

Opilio Recruitment: Publishing Application Support Analyst

£30k - 35k per year + Benefits: Opilio Recruitment: We’re currently re...

Opilio Recruitment: Digital Marketing Manager

£35k - 45k per year + benefits: Opilio Recruitment: A fantastic opportunity ...

Opilio Recruitment: Sales Manager

£60k - 80k per year + Benefits: Opilio Recruitment: A fantastic opportunity ...

Day In a Page

Homeless Veterans Christmas Appeal: ‘We give them hope. They come to us when no one else can help’

Christmas Appeal

Meet the charity giving homeless veterans hope – and who they turn to when no one else can help
Should doctors and patients learn to plan humane, happier endings rather than trying to prolong life?

Is it always right to try to prolong life?

Most of us would prefer to die in our own beds, with our families beside us. But, as a GP, Margaret McCartney sees too many end their days in a medicalised battle
Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night - is that what it takes for women to get to the top?

What does it take for women to get to the top?

Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night and told women they had to do more if they wanted to get on
Christmas jumper craze: Inside the UK factory behind this year's multicultural must-have

Knitting pretty: British Christmas Jumpers

Simmy Richman visits Jack Masters, the company behind this year's multicultural must-have
French chefs have launched a campaign to end violence in kitchens - should British restaurants follow suit?

French chefs campaign against bullying

A group of top chefs signed a manifesto against violence in kitchens following the sacking of a chef at a Paris restaurant for scalding his kitchen assistant with a white-hot spoon
Radio 4 to broadcast 10-hour War and Peace on New Year's Day as Controller warns of cuts

Just what you need on a New Year hangover...

Radio 4 to broadcast 10-hour adaptation of War and Peace on first day of 2015
Cuba set to stage its first US musical in 50 years

Cuba to stage first US musical in 50 years

Claire Allfree finds out if the new production of Rent will hit the right note in Havana
Christmas 2014: 10 best educational toys

Learn and play: 10 best educational toys

Of course you want them to have fun, but even better if they can learn at the same time
Paul Scholes column: I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season

Paul Scholes column

I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season
Lewis Moody column: Stuart Lancaster has made all the right calls – now England must deliver

Lewis Moody: Lancaster has made all the right calls – now England must deliver

So what must the red-rose do differently? They have to take the points on offer 
Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

It's in all our interests to look after servicemen and women who fall on hard times, say party leaders
Millionaire Sol Campbell wades into wealthy backlash against Labour's mansion tax

Sol Campbell cries foul at Labour's mansion tax

The former England defender joins Myleene Klass, Griff Rhys Jones and Melvyn Bragg in criticising proposals
Nicolas Sarkozy returns: The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?

Sarkozy returns

The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?
Is the criticism of Ed Miliband a coded form of anti-Semitism?

Is the criticism of Miliband anti-Semitic?

Attacks on the Labour leader have coalesced around a sense that he is different, weird, a man apart. But is the criticism more sinister?
Ouija boards are the must-have gift this Christmas, fuelled by a schlock horror film

Ouija boards are the must-have festive gift

Simon Usborne explores the appeal - and mysteries - of a century-old parlour game