-------------- D -------------- DAC. See Development Assistance Committee. DATA PROCESSING. See Services. DEFICIENCY PAYMENTS. Government payments to compensate farmers for all or part of the difference between producer prices actually paid for a specific commodity and higher guaranteed target prices. See also Common Agricultural Policy; and Variable Levy. DE FACTO. As it exists in practice. DE JURE. According to legal requirements. DEMAND. The quantity of an economic good that will be bought at a given price at a particular time in a specific market.A demand schedule indicates the quantity of an economic good that will be bought at all possible prices at a particular time in the market. Demand in a market economy is strongly influenced by consumer preference or the individual choices of many independent buyers, based upon their perceptions of value for price. See also Goods; Market; Market Economy; Price; Purchasing Power; Supply; Trade Diversion; Utility; and Value. DEMAND SCHEDULE. See Demand. DEVALUATION. The lowering of the value of a national currency in terms of the currencies of other nations. Devaluation tends to reduce domestic demand for imports in a country by raising their prices in terms of the devalued currency and to raise foreign demand for the country's exports by reducing their prices in terms of foreign currencies. Devaluation can therefore help to correct a balance of payments deficit and sometimes provide a short-term basis for economic adjustment of a national economy. See also Adjustment; Beggar-Thy-Neighbor Policy; and Currency. DEVELOPED COUNTRIES. A term used to distinguish the more industrialized nations -- including most OECD member countries -- from "developing" or less developed countries. The developed countries are sometimes collectively designated as the Group B countries or the "North" because most of them are in the Northern Hemisphere. See also Developing Countries; Group B; Industrial Revolution; and Organization for Economic Cooperation and Development. DEVELOPING COUNTRIES. A broad range of countries that generally lack a high degree of industrialization, infrastructure and other capital investment, sophisticated technology, widespread literacy and advanced living standards among their populations as a whole. The developing countries are sometimes collectively designated as the "South," because a large number of them are in the Southern Hemisphere. All of the countries of Africa (except South Africa), Asia(except Hong Kong, Singapore, South Korea, and Taiwan) and Oceania (except Australia, Japan and New Zealand), Latin America, and the Middle East are generally considered "developing countries," as are a few European countries (Cyprus, Malta, Turkey, Poland, Hungary, the Czech Republic and Slovakia, for example). Some experts have identified four sub-categories of developing countries as having different economic needs and interests: *A few relatively wealthy OPEC countries -- sometimes referred to as oil-exporting developing countries -- share a particular interest in a financially sound international economy and open capital markets. *Newly Industrializing Economies (NIEs) have a growing stake in an open international trading system. *A number of middle income countries -- principally commodity exporters -- have shown a particular interest in commodity stabilization schemes. *Some 36 very poor countries ("least developed countries") are predominantly agricultural, have sharply limited development prospects during the near future, and tend to be heavily dependent on official development assistance. See also ACP Countries; Economic Development; Graduation; Group of 77; Infrastructure; Least Developed Countries; Newly Industrializing Economies; Official Development Assistance; Organization of Petroleum Exporting Countries; Reciprocity; Technology; Textiles; and World Bank. DEVELOPMENT ASSISTANCE COMMITTEE (DAC). The OECD body that reviews and assesses resource transfers from developed to developing countries. See also Official Development Assistance; Organization for Economic Cooperation and Development. DIFFERENTIAL EXPORT TAX. A multi-tier export tax usually structured so that the tax on exports of a raw material exceeds the tax (if any) on exports of processed goods made from the raw material, thereby creating an incentive to process the raw material domestically. See also Boycott; Embargo; and Supply Access. DIFFERENTIAL TREATMENT (FOR DEVELOPING COUNTRY EXPORTS). See Framework Agreement; and Special and Differential Treatment. DILLON ROUND. Trade negotiations that took place under the aegis of GATT from 1960 to 1962, named after Douglas Dillon,then the U.S. under secretary of state, who publicly proposed the negotiations. See also Item-by-Item Negotiations; and Round. DIRECT TAX. A tax that is levied on the wealth or income of individuals. Income, wealth, and inheritance taxes and social security charges are examples of direct taxes. See also Equity; Indirect Tax; and Tax. DISC. See Foreign Sales Corporation. DISCRIMINATION. Inequality of treatment accorded imports from different trading partners, as through preferential tariff rates for imports from particular countries or trade restrictions that apply to the exports of certain countries but not to similar goods from other countries. See also Government Procurement Policies and Practices; Most-Favored-Nation Treatment; Preferences; and Quarantine, Sanitary, and Health Laws and Regulations. DISPUTE SETTLEMENT. In the trade context, dispute settlement usually refers to procedures for consultation, conciliation and possible referral to a neutral third party of a dispute between parties to a trade agreement. Under the General Agreement on Tariffs and Trade (GATT), provisions for consultations, and for the GATT Contracting Parties to make recommendations and rulings in particular disputes, are contained in Articles XXII and XXIII. Procedures to implement those provisions were adopted by the Contracting Parties in 1966, 1979, 1982, 1984, 1989 (procedures adopted on an interim basis), and most recently in 1993. Under the 1993 Uruguay Round agreement, countries agreed to change the previous GATT structure for dispute resolution between Contracting Parties as part of the larger effort to create a strong WTO. Most significantly, it is no longer possible for one country to block adoption of the findings of expert GATT panels formed to review complaints. Under the new system, all members must disagree with the panel's findings for them to be blocked. The new dispute settlement process within the WTO follows several stages: consultation and conciliation, establishment of dispute panels, adoption of panel decisions and follow-up surveillance. In addition, the U.S.-Canada Free Trade Agreement contains very detailed procedures for the settlement of disputes arising under that agreement. See also Arbitration; Case Law;Codes of Conduct; Consultations; Framework Agreement; Government Policies and Procedures; Panel of Experts; Tokyo Round; and Uruguay Round. DISRUPTION. See Market Disruption. DISTRIBUTION. The dissemination of goods and services in a market through the ordinary channels of trade. See also Export Promotion; Market; Sales Tax; Technology; and Trade Fair. DOMESTIC INTERNATIONAL SALES CORPORATION (DISC). See Foreign Sales Corporation. DOMESTIC SUBSIDY. Any act, practice or measure other than an export subsidy by which a government confers a benefit upon a product and/or enterprise. For purposes of U.S. countervailing duty law, a domestic subsidy is considered countervailable if benefits under a program are provided, or are required to be provided by government action, in law or in fact,to a specific enterprise or industry, or group of enterprises or industries. See also Countervailing Duties. DOMESTIC SYSTEM OF PRODUCTION. The system of economic production that prevailed in Europe in the 16th and 17th centuries, prior to the Industrial Revolution, under which merchants supplied materials and sometimes tools and machines to workers who produced finished goods in their homes and turned them over to the merchants. See also Industrial Revolution; and Production. DOUBLE-COLUMN TARIFF. A tariff schedule listing two duty rates for some or all commodities. Under such arrangements, imports may be taxed at a higher or lower rate, depending upon the importing country's trade and other relationships with the exporting country. Some British Commonwealth countries maintain a double-column tariff that provides preferential tariff treatment to other members of the Commonwealth. The United States and other countries also have lower tariffs for countries to which they grant most-favored-nation treatment. See also Column 1 Rates; Column 2 Rates; Most-Favored-Nation Treatment; Preferences; Single-Column Tariff; and Tariff. DOWNSTREAM DUMPING. Downstream dumping, also known as "input dumping," is the practice of exporting an end-product containing an input that has been purchased at less than normal value. U.S. anti-dumping law contains provisions for monitoring downstream dumping where the input is already the subject of an anti-dumping duty order. If monitoring reveals that imports of the end-product increase as a result of the diversion of the input product into the end-product,an anti-dumping investigation of the end-product may be initiated. See also Anti-Dumping Code; and Dumping. DRAWBACK. Import duties or taxes repaid by a government, in whole or in part, when the imported goods are re-exported or used in the manufacture of exported goods. DRY CARGOES. See Bulk Carrier. DUAL PRICING. Selling identical products for different prices in different markets. Dual pricing often reflects export subsidy and dumping practices. See also Dumping; Export Subsidies; and Restitutions. DUMPING. Under U.S. law, dumping consists of sales of merchandise exported to the United States at "less than fair value," when such sales materially injure or threaten material injury to producers of like merchandise in the United States. "Fair value" is usually considered to be a price at which the merchandise is sold within the exporting contrary to third countries. "Fair value" can also be the "constructed value" of the merchandise sold in the U.S. market, which is the cost of materials, labor and factory overhead, a minimum of 10 percent for general and administrative costs, a minimum eight-percent profit margin, and packing costs. A "cost of production" provision requires that dumping determinations ignore sales in the home market of the exporting country or in third-country markets at prices that are too low to "permit recovery of all costs within a reasonable period of time in the normal course of trade." Economists disagree as to the harmful effects of dumping. Some consider dumping to establish a "toehold" in a new market to be a normal commercial practice. Dumping is recognized by GATT rules as a potentially unfair trade practice that can disrupt markets and injure producers of competitive products in the importing country. Dumping is, however, technically legal under GATT rules unless injury is found. In 1993,as part of the Uruguay Round accord, GATT member countries created more detailed rules governing their ability to take action against imports sold at an unfairly discounted export price. Countries agree to terminate all anti-dumping duties after five years (which will require a change in U.S. law) and to raise the "de minimis" rule (the lowest rate at which a dumping margin can be determined) to two percent (U.S. law defines it at 0.5 percent.) The accord also establishes a new Committee on Anti-Dumping Practices, which countries must promptly notify of all dumping actions. See also Anti-Dumping Code; Dual Pricing; Market Disruption; Trigger Price Mechanism; and U.S. International Trade Commission. DUTY. See Tariff. DUTY SUSPENSION. A unilateral non-application of a customs duty, or its application at a reduced level, usually on a temporary basis. See also Tariff; and Unilateral.