Steps taken in recent years to encourage international investment highlight the distinction between the current era of globalization and prior times. These steps are also the source of some of the more significant political controversies surrounding globalization.

The old system of the General Agreement on Trade and Tariffs (GATTAt the Bretton Woods conference following World War II, representatives of the United States, Great Britain, France, Russia, and 40 other countries created GATT to reduce barriers to international trade. It was an agreement not an organization. The functions of GATT were taken over by the World Trade Organizationan international body dealing with the rules of trade between participating nations when it was established in 1990.) from 1947 to 1994 was almost exclusively concerned with the reduction of tariffs, i.e. barriers at the borders between nations. As discussed in the Trade Issue in Depth, tariffs inhibit trade, and result in reduced economic efficiency. But in 1994, the GATTAt the Bretton Woods conference following World War II, representatives of the United States, Great Britain, France, Russia, and 40 other countries created GATT to reduce barriers to international trade. It was an agreement not an organization. The functions of GATT were taken over by the World Trade Organizationan international body dealing with the rules of trade between participating nations when it was established in 1990. system was replaced by a new formal international organization, called the World Trade Organizationan international body dealing with the rules of trade between participating nations (WTOan international body dealing with the rules of trade between participating nations). The WTOan international body dealing with the rules of trade between participating nations established for the first time rules on trade in services (in addition to goods); rules for the protection of intellectual propertyIntellectual property refers to the creations of the mind, such as inventions, literary or artistic works, and the symbols, names, and designs used in commerce.; rules for technical, sanitary, and phytosanitary standards; and others.

Today, everything from banking services to movies and computer software move across international borders at a rapid pace, so a new set of agreements was needed.

In addition to facilitating this explosion of trade with new rules on intellectual propertyIntellectual property refers to the creations of the mind, such as inventions, literary or artistic works, and the symbols, names, and designs used in commerce., services, and technical standards, the WTOan international body dealing with the rules of trade between participating nations and other groups have undertaken steps to promote internal economic liberalization that goes beyond simply removing tariffs at the border. Efforts to improve the global environment for international investment have produced some helpful initial steps.

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