Jul 17, 1986

U.S. COMPLAINS OVER JAPANESE AGRICULTURE IMPORTS.

GENEVA, JULY 15 (IFDA-CHAKRAVARTHI RAGHAVAN) The United States advised the GATT Council Tuesday of its intention to seek the establishment of a GATT panel to rule on its complaints of Japanese illegal restrictions on imports of some 12 categories of agricultural products.

The U.S. delegate, Amb. Samuels, who raised this issue did not specify the actual agricultural products it was complaining about according to a GATT spokesman.

The U.S. itself is to bring the issue up formally at the next GATT Council meeting, which would be in October, after the conclusion of the Punta del Este Ministerial meeting on the proposed new trade round.

The U.S. action Tuesday in raising this issue, and focussing on Japanese policies in the agricultural trade, intrigued some of the GATT participants.

Some of them privately wondered whether this would mean that the U.S. and EEC would be reaching some kind of private understanding, that would in effect reduce the scope of negotiations in agriculture in the new proposed GATT round, and hence the U.S. move to spotlight through a GATT dispute on Japanese practices.

Previously the U.S. has been at the forefront of those complaining over EEC agricultural trade policies, and its actions in restricting access to EEC markets.

Other temperate zone agricultural producer/exporters Australia, New Zealand, Argentina, Uruguay, and Chile have also been bitterly critical of the EEC and U.S. policies, and all of them have been seeking a wide negotiating mandate for the agriculture sector in the proposed new round.

A 1984 report of the GATT committee on trade in agriculture has in fact put forward a proposal that would bring the agricultural practices of all these countries including those under waivers like the U.S. and Switzerland, or those of the European Community and its practices of variable levies to protect its domestic market and subsidised exports on the negotiating table.

The EEC has however been insisting that while it would negotiate on agriculture, its common agricultural policy could not be challenged, and it would not participate in any negotiations involving this.

Recently, the U.S. and EEC have entered into a bilateral accord to "cool down" their bilateral disputes in the agricultural trade area, specially those arising out of the enlargement of the EEC through the accession of Spain and Portugal.

While both sides disclaim this, there have been some reports that the "U.S.-EEC truce" is just to tip of the iceberg, and that in fact the U.S. and EEC (as in the Tokyo Round) are now moving to some kind of bilateral accords which would in effect preserve their mutual markets, at the cost of other agricultural producers.

In raising its dispute, the U.S. told the GATT Council Tuesday that Japan had been applying quantitative restrictions (QRS), since 1963, on agricultural imports in 12 product categories in contravention of its GATT obligations.

U.S. efforts, through bilateral consultations, to have them lifted had failed, and hence its move to seek GATT adjudication.

In responding in the GATT Council to the U.S. move, the Japanese delegate, Amb. Kazuo Chiba said he could not concur with the idea of setting up a panel.

Chiba referred to the Japanese moves to improve market access for agricultural products, and said the products complained of by the U.S. were of a "very sensitive nature".

The GATT Committee on Trade in Agriculture, Chiba noted, had been working on a mandate for broad negotiations in the agriculture sector, including for more effective GATT disciplines, in the proposed new round.

This, Chiba noted, would include Japanese restrictions, as also U.S. restrictions maintained for over 30 years now under the "permanent waiver", and he could not understand the U.S. request for adjudication.

The U.S. apparently did not respond to the Japanese remarks.

In other disputes, the U.S. announced that at long last the "manufacturing clause" in its trade laws providing protection against imports of books and other material of U.S. Citizens printed or manufactured abroad had expired as of June 30, and the U.S. was now complying with a 1984 GATT Panel ruling, which had held the provision to be violative of U.S. obligations under GATT.

In a EEC-Japan dispute, it was agreed to set up a intergovernmental group of experts to examine problems, falling within the competence of GATT, relating to "current trends in world trade in copper, including supply and demand situation for copper concentrates and refined copper", and report to the GATT Council..

The EEC has been complaining that some of the Japanese practices protected its domestic industry, in violation of GATT obligations.