Question

Which of the following is a provision of the Uruguay Round Agreement?

A. A wide range of services were to be excluded from GATT fair trade and market access rules.

B. Tariffs on industrial goods were to be raised by more than one-third, and tariffs were to be scrapped on more than 50 percent on a wide range of services.

C. The International Monetary Fund (IMF) was to be created to implement the GATT agreement.

D. Barriers on trade in textiles were to be significantly reduced over 10 years.

E. Average tariff rates imposed by developed nations on manufactured goods were to be raised by 20 percent of the value, the highest level in modern history.

Answer 1

The Uruguay Round Agreement resulted in significant reductions in trade barriers, especially in the textile sector, over a decade. It also led to the transformation of GATT into the WTO, facilitating global trade with improved resolution of disputes.

Step-by-step explanation:

The correct provision of the Uruguay Round Agreement is that it significantly reduced barriers on trade in textiles. Over a 10-year period, the agreement foresaw a progressive reduction in the protectionism that had previously characterized this sector. The Uruguay Round Agreement was a comprehensive set of trade negotiations that took place under the auspices of the General Agreement on Tariffs and Trade (GATT), covering not only textiles but also a broader array of topics like agriculture, services, and the creation of the World Trade Organization (WTO).

This round contributed to the longstanding trend of lowering trade barriers, building on the progress that GATT negotiations had made in reducing average tariff levels from 40% in 1946 to less than 5% in 1990. The transformation of GATT into the WTO was a significant outcome of this round, paving the way for more structured and institutionalized trade relations and dispute resolution among the member countries.