The main drawback of multilateral agreements is that they are complex. This makes them difficult and tedious to negotiate. Sometimes the length of the negotiations means that it will not take place at all. Multilateral trade agreements are trade agreements between three or more nations. The agreements reduce tariffs and facilitate the import and export of companies. Because they belong to many countries, they are difficult to negotiate. The creation of the WTO on 1 January 1995 was the largest reform of international trade since the end of the Second World War. While GATT was primarily involved in merchandise trade, the WTO and its agreements also deal with trade in services and intellectual property. The creation of the WTO has also created new dispute settlement procedures. Some regional trade agreements are multilateral. The most important was the North American Free Trade Agreement (NAFTA), ratified on January 1, 1994. Nafta quadrupled trade between the United States, Canada and Mexico from 1993 to 2018. The U.S.-Mexico Agreement (USMCA) came into force on July 1, 2020.
The USMCA was a new trade agreement between the three countries, negotiated under President Donald Trump. The fourth advantage is that countries can negotiate trade agreements with more than one country at the same time. Trade agreements are subject to a detailed authorisation procedure. Most countries would prefer to ratify an agreement covering many countries at the same time. The Uruguay cycle began in September 1986 in Punta del Este, Uruguay. The focus has been on extending trade agreements to several new areas. These include services and intellectual property. It has also improved the agricultural and textile trade. The Uruguay Round led to the creation of the World Trade Organization.
On 15 April 1994, the 123 participating governments signed the WTO agreement in Marrakech, Morocco. The WTO has taken the lead in future global multilateral negotiations. A single page of text from 1941 is a strong reminder that the desire for peace and security has fostered the creation of the current global economic system. The global rules that underpinned our multilateral economic system were a direct response to the Second World War and the desire that it would never happen again. The WTO is a multilateral, rules-based organization that creates an open, secure, transparent, fair and predictable environment for world trade.