State-trading Systems and the GATT Framework

Abstract

The General Agreement was created for market economies and essentially private-enterprise economies. It was unlikely, therefore, to provide an adequate framework to deal with centralized economies and essentially state-enterprise economies. Both the application of its principles and the clauses most appropriate to state trading seemed likely to raise problems. This chapter reviews GATT rules on nondiscrimination, reciprocity, trade control, state trading and safeguard action, and considers the difficulties to be expected in applying them to state-enterprise economies.