Non Tariff Barriers:

Non-tariff barriers, unlike tariffs, are non tax measures imposed by governments to favor domestic over foreign suppliers. Non tariff barriers encompass a wide range of measures. Some have relatively unimportant trade effects. For example, packaging and labeling requirements can impede trade, but usually only marginally. Other non tariff measures such as quotas, voluntary export restraints, trade restraints. under the Multitier Arrangement, non automatic import authorizations and variable import levies have much more significant effects. These hard core nontariff measures are designed to reduce imports and, thereby, benefit domestic producers. Restrictions on international trade, primarily in the form of non tariff barriers, have multiplied rapidly in the 1980s. The Japanese, for example, began restricting automobile exports to the United States in 1981. One year later, the U.S. government, as part of its ongoing intervention in the sugar market, imposed quotas on sugar imports. As a type of protectionist policy, non tariff barriers produce the general consequences identified above; however, there are numerous reasons, besides their proliferation, to focus attention solely on non tariff barriers. Non tariff barriers encompass a wide range of specific measures, many of whose effects are not easily measured. For example, the effects of a government procurement process that is biased toward domestic producers are difficult to quantify. In addition, many non tariff barriers discriminate among a country's trading partners. This discrimination violates the most favored nation principle, a cornerstone of the General Agreement on Tariffs and Trade (GATT), the multinational agreement governing international trade. Countries use many mechanisms to restrict imports. A critical objective of the Uruguay Round of GATT negotiations, shared by the U.S., was the elimination of non tariff barriers to trade in agricultural commodities (including quotas) and, where necessary, to replace them with tariffs a process called tarrification. In fact, tarrification of agricultural commodities was largely achieved and viewed as a major success of the 1994 GATT agreement.