U.S. Trade Policy in Transition: An Overview

Since the early 1980s the U.S. has been suffering large and chronic trade and current account deficits. These have been caused by large U.S. budget deficits, increased industrial competition from many countries. The World debt crisis of the 1980s had a big impact on U.S. trade bargaining strategy, the Uruguay RoundGATT outcomes. The U.S. trade policy has adjusted to new conditions to capture the full gains from the developments with the rapid evolution of global trading relationships. In this paper we examine the adjustment environment in the U.S. as set out by the U.S. trade remedy laws (countervailing duties for subsidies, anti-dumping duties, Section 201 safeguard relief, Section 301 remedies, and balance of payments relief) under GATT/WTO. How has the U.S. responded to opportunities and challenges associated with the change of global trade relations? Specifically, what options for improved U.S. trade balance operated under the GATT 1947? How does the GATT 1994 and the WTO alter this situation and the scope for U.S. trade remedies? This paper begins with an analysis of the economic situation of the U.S. with respect to foreign trade. Then, it examines how U.S. trade policy could accomplish in response to changes in global market condition by the means provided by GATT 1994, or by the measures provided by GATT 1947, if there would be any need for a change. Based on the review, we will provide prospects of the U.S. trade policy for the future and the implications for global trade relationships.