---
title: "GATT — AP Euro Definition & Exam Guide"
description: "GATT (1947) was the post-WWII agreement cutting tariffs between Western nations. Key to AP Euro Topic 9.4 as part of the US-led world trade system vs COMECON."
canonical: "https://fiveable.me/ap-euro/key-terms/general-agreement-on-tariffs-and-trade"
type: "key-term"
subject: "AP European History"
unit: "Unit 9"
---

# GATT — AP Euro Definition & Exam Guide

## Definition

The General Agreement on Tariffs and Trade (GATT, 1947) was a multilateral agreement that set rules for reducing tariffs and trade barriers among Western nations, forming part of the US-backed world monetary and trade system created after World War II (AP Euro Topic 9.4).

## What It Is

The General Agreement on Tariffs and Trade (GATT) was signed in 1947 as part of the rebuilding of the global economy after [World War II](/ap-euro/unit-8/world-war-ii/study-guide/U4UCrRJlJSuTdFmINVgr "fv-autolink"). Its core job was simple. Member countries agreed to lower tariffs (taxes on imports) and reduce other trade barriers, so goods could flow more freely between nations. The logic came straight out of the 1930s, when countries had walled themselves off behind high tariffs and made the Great Depression worse. GATT was the attempt to never let that happen again.

For [AP Euro](/ap-euro "fv-autolink"), GATT matters as one piece of the US-led economic order in Western Europe. The CED (KC-4.1.IV.C) says [the United States](/ap-euro/key-terms/the-united-states "fv-autolink") exerted strong military, political, and economic influence in Western Europe, "leading to the creation of world monetary and trade systems and geopolitical alliances, including NATO." GATT is the trade half of that system, working alongside the International Monetary Fund (the money half). In 1995, GATT was replaced by the World Trade Organization (WTO), which still regulates global trade today.

## Why It Matters

GATT lives in [Unit 9](/ap-euro/unit-9 "fv-autolink") (Cold War and Contemporary Europe), Topic 9.4 (Two Super Powers Emerge), and supports learning objective 9.4.A, which asks you to explain the economic and political consequences of the Cold War for Europe. Here's the big picture the exam wants you to see. After 1945, Europe split into two competing economic systems. The West, under American influence, built market-based institutions like GATT and the IMF that encouraged open trade. The East, under Soviet domination, got [COMECON](/ap-euro/key-terms/comecon "fv-autolink") and central planning (KC-4.1.IV.D, KC-4.2.V.A). GATT isn't just a trade deal. It's evidence of how the bipolar world order showed up in everyday economics, not just in armies and alliances.

## Connections

### [Council for Mutual Economic Assistance (COMECON) (Unit 9)](/ap-euro/key-terms/council-for-mutual-economic-assistance-comecon)

COMECON was the [Soviet bloc](/ap-euro/key-terms/soviet-bloc "fv-autolink")'s answer to Western economic integration. GATT lowered barriers between market economies, while COMECON tied Eastern Europe's centrally planned economies to Moscow. Together they show how the Iron Curtain was an economic divide, not just a military one.

### [International Monetary Fund (Unit 9)](/ap-euro/key-terms/international-monetary-fund)

GATT and the IMF were two halves of the same post-WWII system. The IMF stabilized currencies and the world's money supply, while GATT handled trade rules and [tariffs](/ap-euro/unit-6/second-wave-industrialization-its-effects/study-guide/b5lPxh2BwluZk3TEHgwf "fv-autolink"). When the CED mentions 'world monetary and trade systems,' it means IMF (monetary) and GATT (trade).

### [Bipolar World Order (Unit 9)](/ap-euro/key-terms/bipolar-world-order)

GATT is concrete evidence for the bipolar world. Western Europe joined a US-anchored network of open trade, while [Eastern Europe](/ap-euro/key-terms/eastern-europe "fv-autolink") was locked into Soviet-controlled exchange. If an essay asks how the Cold War divided Europe economically, GATT vs COMECON is your cleanest contrast.

### Great Depression and Economic Nationalism (Unit 8)

GATT only makes sense as a reaction to the interwar period. In the 1930s, countries raised tariffs and turned inward, deepening the Depression and fueling extremism. GATT's tariff-cutting mission was the postwar West saying 'we learned our lesson.'

## On the AP Exam

GATT shows up most often in multiple-choice questions about the post-WWII economic order. Typical stems ask what GATT's primary purpose was (reducing tariffs and trade barriers among member nations) or which organization preceded the WTO in regulating international trade (GATT is the answer). No released FRQ has used the term verbatim, but it's strong evidence for essays on LO 9.4.A. In an LEQ or DBQ on the consequences of the Cold War for Europe, pairing GATT with the IMF and NATO on the Western side, against COMECON and the Warsaw Pact on the Eastern side, gives you a tight comparison structure that hits the prompt directly.

## General Agreement on Tariffs and Trade vs World Trade Organization (WTO)

GATT came first. It was an agreement signed in 1947, not a full organization, and it governed world trade rules for almost fifty years. The WTO replaced GATT in 1995 as a permanent institution with stronger enforcement powers. On the exam, if the question is about the Cold War era, the answer is GATT. If it's about trade regulation today, it's the WTO.

## Key Takeaways

- GATT was established in 1947 to reduce tariffs and trade barriers between member nations, rebuilding world trade after WWII.
- GATT was part of the US-led world monetary and trade system in Western Europe, alongside the IMF, as described in KC-4.1.IV.C.
- GATT and the IMF integrated Western Europe into a market-based system, while COMECON tied Eastern Europe to Soviet central planning.
- The GATT-COMECON contrast is the clearest way to show the economic side of the bipolar world order in an essay.
- GATT was replaced by the World Trade Organization (WTO) in 1995, so GATT is the Cold War-era answer and the WTO is the modern one.

## FAQs

### What was the General Agreement on Tariffs and Trade (GATT)?

GATT was a 1947 international agreement in which member nations committed to reducing tariffs and other trade barriers. In AP Euro, it's part of the US-influenced world trade system built in Western Europe after WWII (Topic 9.4).

### Is GATT the same thing as the WTO?

No. GATT was an agreement that governed world trade from 1947 until 1995, when the World Trade Organization replaced it as a permanent institution with stronger enforcement. GATT is the predecessor, the WTO is the successor.

### How is GATT different from COMECON?

GATT was the Western system, promoting open trade and lower tariffs among market economies under US influence. COMECON was the Soviet-controlled alternative that bound Eastern Bloc economies to Moscow through central planning. They're mirror images on opposite sides of the Iron Curtain.

### Why was GATT created in 1947?

To prevent a repeat of the 1930s, when high tariffs and economic nationalism deepened the Great Depression. After WWII, the US and its allies built GATT and the IMF to keep trade open and currencies stable.

### Do I need to know GATT for the AP Euro exam?

Yes, mainly for Unit 9 multiple-choice questions on the postwar economic order and as essay evidence for LO 9.4.A on the economic consequences of the Cold War. Know its purpose (tariff reduction), its date (1947), and its place in the Western system versus COMECON.

## Related Study Guides

- [9.4 Two Super Powers Emerge](/ap-euro/unit-9/two-superpowers-emerge/study-guide/dAdAjyP3ACYnfKXch6jj)

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