MFN Tariff

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MFN Tariff

A tariff applied to a country with most favored nation status. An MFN tariff is the lowest possible tariff a country can assess on another country. For example, if a country's lowest tariff is 2% of the value of a good, this is its MFN tariff, and it charges this percentage on an import from a country with most favored nation status. Members of the World Trade Organization are required to extend most favored nation status to other members, though exceptions exist. In the United States, most favored nation status is formally called permanent normal trade relations.
References in periodicals archive ?
It is notable that two-thirds of goods attracting MFN tariffs in excess of 15% were not granted preferences under any PTA.
No developing country has ever lowered an applied MFN tariff on the altar of a GAIT
On the one hand, lower preferential tariffs within these free trade agreements no longer offer much of an advantage because non-preferential tariffs ('most-favoured nation' or MFN tariffs in WTO jargon) are already low.
As members of the World Trade Organization (WTO), each NAFTA country is generally required to apply its MFN tariffs to all other WTO members.
The only realistic solution will be to reduce global MFN tariffs to such negligible levels that PTAs no longer matter.
Fourth, preferential tariffs should not be defined in absolute terms, but should be set relative to MFN tariffs.
economic integration, resulted in MFN tariffs for both Canada and the U.
For those products with current applied MFN tariffs lower than 5%, China and the six original ASEAN members will do away with the tariffs on them by Jan.
Each of these roles arises from basic properties of reciprocity and MFN - namely, that mutual changes in trade policy conforming to reciprocity will stabilize the terms of trade, and that MFN tariffs will ensure that all countries can trade on the same terms (face the same set of exporter prices).
40) Even though MFN tariffs are high, utilization rates have increased since the granting of MFN status.
Table 10: Comparative MFN tariffs on imports of selected textile and clothing products into developed countries, as of January 1, 2004