Wto Trade Agreement Us

Secretariat Report: Summary of Observations The United States has one of the most open and transparent trading and investment systems in the world, although significant barriers to market access persist in some important areas. These have a direct impact on world trade, with the United States being both the world`s largest individual economy and distributors. Removing these remaining barriers would be in line with traditional U.S. support for liberalization and competition promotion policies that would otherwise further strengthen their economies and benefit domestic consumers and taxpayers. There would also be distortions in global markets, friction with trading partners and strengthening the multilateral trading system. These considerations are particularly moving in light of the current global economic downturn and the potential protectionist pressure that could result. Since the last U.S. review in July 1999, U.S. trade policies and practices have remained broadly unchanged. Changes made during this period include improvements in market access for some developing countries and the consolidation of national financial rules. Since 1999, public payments to agricultural and food producers have also increased, while the share of steel products in all anti-dumping, countervailing and safeguarding measures has increased. In sectors such as textiles and clothing, transport and some service sectors, significant barriers to foreign competition remain. Governments` new response to these political challenges will represent global trade and people`s well-being.

Economic and political developments Since their last revision, U.S. monetary and fiscal policies have been relaxed to counter the recent slowdown in economic growth from 5% in 2000 to an annual rate of about 1% in mid-2001. This slowdown was highlighted by lower inventories and exports. Consumer spending remains high, but imports have declined significantly. The six interest rate cuts in the first half of 2001 are accompanied by tax cuts estimated at $1.35 trillion over 11 years, largely made possible by budget surpluses in recent years. Although inflation has increased, it does not appear to be an important issue at this time. The U.S. current account deficit widened during the period under review to 4.5% of GDP in 2000, financed by capital inflows, particularly investment inflows. These flows have been a factor in the continued nominal strength of the U.S.

dollar. While this puts pressure on domestic industry, the rapid growth in productivity over the past decade has largely allowed firms to remain competitive with foreign producers.