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{{Short description|Former system of textile export quotas}}
{{Short description|Former system of textile export quotas}}
The '''Agreement on Textiles and Clothing (ATC)''' succeeded the [[Multi Fibre Arrangement|Multi Fibre Arrangement (MFA)]] and facilitated the gradual dismantling of quotas that were in effect during the MFA period. This process culminated on 1 January 2005. However, significant tariffs continued to be applied to various [[Textile|textile products]], even after the completion of the ATC. Under the MFA, quotas were imposed on the export of textiles and garments from [[Developing country|developing countries]] to [[Developed country|developed nations]] from 1974 to 1994.<ref name=":0" /><ref>{{Citation |title=Agreement on Textiles and Clothing |date=2012 |url=https://www.cambridge.org/core/books/wto-analytical-index/agreement-on-textiles-and-clothing/7BC2741A35827EFFC66F7FD22FF83BDD |work=WTO Analytical Index: Guide to WTO Law and Practice |pages=597–632 |editor-last=Legal Affairs Division |editor-first=World Trade Organization |access-date=2023-07-30 |series=WTO Internal Only |edition=3 |place=Cambridge |publisher=Cambridge University Press |doi=10.1017/CBO9781139177955.007 |isbn=978-1-139-17795-5}}</ref>
The '''Agreement on Textiles and Clothing (ATC)''' succeeded the [[Multi Fibre Arrangement|Multi Fibre Arrangement (MFA)]] and facilitated the gradual dismantling of quotas that were in effect during the MFA period. This process culminated on 1 January 2005. However, significant tariffs continued to be applied to various [[Textile|textile products]], even after the completion of the ATC. Under the MFA, quotas were imposed on the export of textiles and garments from [[Developing country|developing countries]] to [[Developed country|developed nations]] from 1974 to 1994.<ref name=":0" /><ref>{{Citation |last=Lester |first=Simon |title=The Agreement on Textiles and Clothing |date=2005 |url=https://doi.org/10.1007/0-387-22688-5_9 |work=The World Trade Organization: Legal, Economic and Political Analysis |pages=411–435 |editor-last=Macrory |editor-first=Patrick F. J. |access-date=2023-07-30 |place=Boston, MA |publisher=Springer US |language=en |doi=10.1007/0-387-22688-5_9 |isbn=978-0-387-22688-0 |editor2-last=Appleton |editor2-first=Arthur E. |editor3-last=Plummer |editor3-first=Michael G.}}</ref><ref>{{Citation |title=Agreement on Textiles and Clothing |date=2012 |url=https://www.cambridge.org/core/books/wto-analytical-index/agreement-on-textiles-and-clothing/7BC2741A35827EFFC66F7FD22FF83BDD |work=WTO Analytical Index: Guide to WTO Law and Practice |pages=597–632 |editor-last=Legal Affairs Division |editor-first=World Trade Organization |access-date=2023-07-30 |series=WTO Internal Only |edition=3 |place=Cambridge |publisher=Cambridge University Press |doi=10.1017/CBO9781139177955.007 |isbn=978-1-139-17795-5}}</ref>


== Background ==
== Background ==

Revision as of 08:22, 30 July 2023

The Agreement on Textiles and Clothing (ATC) succeeded the Multi Fibre Arrangement (MFA) and facilitated the gradual dismantling of quotas that were in effect during the MFA period. This process culminated on 1 January 2005. However, significant tariffs continued to be applied to various textile products, even after the completion of the ATC. Under the MFA, quotas were imposed on the export of textiles and garments from developing countries to developed nations from 1974 to 1994.[1][2][3]

Background

The Agreement on Textiles and Clothing (ATC) was the outcome of negotiations during the Uruguay Roundof Trade Negotiations. It superseded the Arrangement Regarding International Trade in Textiles (MFA, or Multi-Fibre Arrangement) established on 20 December 1973. Textile products were among the most labor-intensive to make and easily shipped. The multi-fiber agreement was written specifically to control rapid changes in the textile trade.

Following the expiration of the ten-year transition period of ATC implementation, trade in textile and clothing products ceased to be subject to quotas under a special regime outside the normal World Trade Organization/General Agreement on Tariffs and Trade rules. Instead, it came under the governance of the general rules and disciplines embedded in the multilateral trading system.[1][4][5]

Significance

In international trade, market access allows companies to sell goods and services in foreign markets, subject to conditions like tariffs or quotas. It is a more attainable goal in trade negotiations than achieving completely barrier-free trade.[6]

ATC created vast opportunities for export expansion from developing countries.[7][8] The ATC also had a significant impact on manufacturing countries. For instance, in Canada, which used quotas to protect its manufacturers from cheaper goods from developing countries, the ATC's tariff and quota reductions led to the closure of many local plants and layoffs of workers in Winnipeg. Some companies relocated to countries with lower labor costs, like Guatemala, Mexico, Bangladesh, and China.[9]

Market access

Various types of market access arrangements exist, including PTA, FTA, CECA, CEPA, Customs Union, Common Market, TIFA, BIT, and others, each characterized by its unique implementation framework and scope.[10] Trade agreements offer preferential market access,[11] leading to diverse economic benefits such as trade creation, market expansion, capital accumulation, and improved productivity. A Free trade agreement (FTA) is an international deal between cooperating states to form a free-trade area. There are two types: bilateral and multilateral. Bilateral agreements involve two countries easing trade restrictions for business expansion, while multilateral agreements involve three or more countries and are more challenging to negotiate.[12] FTAs play a pivotal role in fostering export growth for the exporting countries.[13]

References

  1. ^ a b "WTO | legal texts - Marrakesh Agreement". www.wto.org. Retrieved 2023-07-30.
  2. ^ Lester, Simon (2005), Macrory, Patrick F. J.; Appleton, Arthur E.; Plummer, Michael G. (eds.), "The Agreement on Textiles and Clothing", The World Trade Organization: Legal, Economic and Political Analysis, Boston, MA: Springer US, pp. 411–435, doi:10.1007/0-387-22688-5_9, ISBN 978-0-387-22688-0, retrieved 2023-07-30
  3. ^ Legal Affairs Division, World Trade Organization, ed. (2012), "Agreement on Textiles and Clothing", WTO Analytical Index: Guide to WTO Law and Practice, WTO Internal Only (3 ed.), Cambridge: Cambridge University Press, pp. 597–632, doi:10.1017/CBO9781139177955.007, ISBN 978-1-139-17795-5, retrieved 2023-07-30
  4. ^ WTO Analytical Index: Agreement on Textiles and Clothing (Report). WTO Analytical Index. World Trade Organization. 2023-01-23. doi:10.30875/618fbe7e-en.
  5. ^ Brambilla, Irene; Khandelwal, Amit; Schott, Peter (August 2007). China's Experience Under the Multifiber Arrangement (MFA) and the Agreement on Textiles and Clothing (ATC) (Report). Cambridge, MA: National Bureau of Economic Research. doi:10.3386/w13346.
  6. ^ "What Is Market Access in International Trade?". Investopedia. Retrieved 2023-07-30.
  7. ^ Wahab, Yasmin Abdul; Jalil, Abdul (2017). "Post-Atc Impacts on Product Intensive and Extensive Trade Margins: A Quantitative Analysis". Pakistan Economic and Social Review. 55 (2): 315–336. ISSN 1011-002X. JSTOR 26616716.
  8. ^ Mayer, Jorg (2005). "Not Totally Naked: Textiles and Clothing Trade in a Quota-Free Environment". Journal of World Trade. 39: 393–426. doi:10.54648/TRAD2005030. S2CID 166648667.
  9. ^ 6 Human Resources and Skills Development Canada. 2004. Labour Market Bulletin-Winnipeg,
  10. ^ "What is economic integration and what are the different types of trade agreements? - Civilsdaily". 2016-02-25. Retrieved 2023-07-30.
  11. ^ Fugazza, Marco; Nicita, Alessandro (2013-03-01). "The direct and relative effects of preferential market access". Journal of International Economics. 89 (2): 357–368. doi:10.1016/j.jinteco.2012.09.001. ISSN 0022-1996.
  12. ^ "Online Free Trade Agreement Certificate (FTAC) - ICC Academy". www.edumaritime.net. Retrieved 2023-07-30.
  13. ^ "How FTAs can lift textile exports". www.thehindubusinessline.com. 2023-02-09. Retrieved 2023-07-30.
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