Trade monitoring

The World Trade Organization came into being in 1995, as the successor to the General Agreement on Tariffs and Trade (GATT), which had been established (1947) in the wake of the Second World War. The WTO’s main objective is the establishment of rules for Members’ trade policy which help international trade to expand with a view to raising living standards. These rules foster non-discrimination, transparency and predictability in the conduct of trade policy.

This section looks at the empirical evidence on the effect of trade on wages and employment and addresses the following key questions: what is the evidence of the impact of import competition and offshoring on the level of wages and employment? What is the impact of increased market access for exports and the availability of cheaper imported inputs on employment? How can varied empirical evidence across countries be reconciled? How does the functioning of the labour market affect outcomes? How large are trade-induced adjustment costs? This section focuses particularly on wages and employment because research on other dimensions of labour markets, such as employment stability and security, is much less developed due to lack of cross-country data and thus does not allow for a comparison of how trade and technology play out on these other variables.

The Trade Policy Review Mechanism (TPRM) was first established on a trial basis by the GATT contracting parties in April 1989. The Mechanism became a permanent feature of the World Trade Organization under the Marrakesh Agreement which established the WTO in January 1995.

Since its last trade policy review, EI Salvador has made considerable progress on the economic front and has continued to consolidate its strategy of appropriate integration in international trade through active participation in the trade negotiation processes and through policies aimed at attracting foreign direct investment.