TEXTILES: FIRST STAGE INTEGRATION WILL BE ILLUSORY

9:41 AM Oct 25, 1994

TEXTILES: FIRST STAGE INTEGRATION WILL BE ILLUSORY
Geneva 25 Oct (Chakravarthi Raghavan) -- Notifications to the GATT Secretariat by the United States and the European Union in terms of the Agreement on Textiles and Clothing and the Marrakesh Ministerial decision on this make clear that in the first stage, the two will 'integrate' into the GATT only product lines not now under any restraint.

According to Art 2 of the ATC, all the restraining countries have to notify their restraints within 60 days of entry into force of the WTO.

Art 2 of the ATC requires each member "to integrate into GATT 1994" -- that is bring under full multilateral GATT disciplines -- products which account for no less than 16% of the member's 1990 imports.

Under the Ministerial decision of Marrakesh, the restraining countries were required to notify by 1 October the details of their proposed integration in the first stage.

Each importing country has been given the option of choosing this 16% from out of an Annex but comprising the four groups of tops and yarns, fabrics, made-up textile products and clothing.

However, all the textiles and clothing products, according to the Harmonised System of classification, have been included in the Annex.

According to the International Textiles and Clothing Bureau's (ITCB) data, such unrestrained items in the Annex account for 47% of imports of Canada, 34% in the EU and 37% in the United States.

In stage two, at the beginning of the 37th month of the entry into force of the WTO and its ATC, a further 17% is to be integrated.

The ITCB has estimated that the way all products have been put into the annex and the integration process set, both the US and EU could fulfil their ATC obligations in the first two stages by integrating only the unrestrained HS lines.

The integration process, according to the ITCB, "may begin to encroach on the MFA restricted area only at the beginning of the third stage i.e. after seven years.

As a part of his bargain with Congress for implementation, President Clinton has already intimated that the sensitive textile products in the US imports will not be integrated until the very end -- 31 December midnight of the tenth year.

The socalled "very sensitive" products in the EU list will also not be integrated until the very end, according to the assurances given by the EC Commission to its Council of Ministers.