THIRD WORLD ASKED TO LIBERALISE IN TROPICAL PRODUCTS.

Mar 4, 1987

THIRD WORLD ASKED TO LIBERALISE IN TROPICAL PRODUCTS.

GENEVA FEB. 27 (IFDA/CHAKRAVARTHI RAGHAVAN) -- The negotiating groups on tropical products (TP Groups) under the Uruguay Round MTNS on goods, at its first meeting Thursday, reportedly agreed to proceed ahead in its work on the basis of the work already done in GATT, both in the trade and development committee and in the consultations on tropical products under the 1982 GATT work programme.

The TP Group is chaired by Paul Leong Khee Seong of Malaysia.

The issue of liberalisation of trade in tropical products, by reducing and/or eliminating tariff and non-tariff barriers in industrial countries against imports from the third world, as well internal taxes inhibiting consumption, has been pending in GATT since Heberler committee report in the 1950s.

It has figured in successive GATT rounds - the Dillon round 1961-62, Kennedy round 1964-67 where it was treated as a separate sector for negotiations, and the Tokyo round 1973-79 where tropical products were treated as "a special and priority sector".

While in the Kennedy and Tokyo rounds, some of the request from third world CPS were responded to by individual industrialised country CPS, no substantial liberalisation took place.

In all the negotiations, no definition of "tropical products" could be agreed upon, but negotiations or work was on the basis of identified products.

In the 1982-84 consultations, a number of products were identified as falling under the category of tropical products, and the TP negotiating group in the Uruguay Round has agreed to proceed on the basis of these products, participants said.

The products covered are:

-- Tropical beverage items - coffee and coffee products, cocoa and cocoa products, and tea and instant tea,

-- Tropical spices and essential oils, tropical cut flowers, tropical plants, vegetable materials, lacs, etc., and their products,

-- Certain oilseeds, vegetable oils and oilcakes,

-- Tobacco, rice and tropical roots (manioc and other tropical rots),

-- Bananas and banana products, tropical fruits and nuts, and their products including fruit juices,

-- Tropical wood and wood products, natural rubber and rubber products,

-- Jute and hard fibres.

Participants said during the discussions Thursday, the U.S. and EEC both suggested that the TP Group should also address the issue of third world countries "liberalising" their own imports of tropical products. The U.S. and EEC are also reported to have referred to their own interest as exporters of some tropical products or their equivalents.

The EEC is also reported to have referred to the preferences enjoyed in the EEC by the ACP (African Caribbean and Pacific) countries, members of the Lome pact, and the need to preserve these preferences under contractual arrangements in any liberalisation work in the round.

The EEC also reportedly underlined that some of the work in the TP Group would overlap with work in other areas, and these should be coordinated.

This was seen as a reference to the work in the group on agriculture, as well as the group on tariff and non-tariff measures.

The Punta del Este declaration envisages special attention for the negotiations on tropical products, including the timing of the negotiations and implementation of the results in cases where agreements are reached at an early stage, on a provisional or definitive basis by agreement, prior to the formal conclusion of the negotiations in the round.

While the Asian countries and some others have been pressing for a "fast Track" approach to the negotiations on tropical products in the Uruguay Round, the U.S. and EEC have avoided formal commitments in this regard.

Some of their pronouncements, since launching the round in September last year, even have cast doubts on this.

The EEC has been talking of the "globality" of the MTNS in goods, and the U.S. has been talking of the need for implementation of the harmonised system on tariff nomenclature (due to begin in 1988), before further tariff cuts or liberalisation could be envisaged.

Some of the tropical products, subject to quantitative restrictions on import bans in the U.S. are covered by the permanent waiver obtained by the U.S. in the 50s in respect of its U.S. agricultures act.

The U.S. has said that the waiver is on the negotiating table, but this has been in the context of the negotiations in the agriculture group, where the U.S. wants the EEC's common agricultural policy to be modified. It is not clear whether this would apply to the negotiations in the TP Group also.

The negotiating plan in the TP sector envisages, in the initial phase to be completed by the end of 1987, agreement on techniques and modalities as a common basis for negotiations, including the tabling of initial requests and offers.

Negotiations are envisaged to begin as early as possible in 1988 on the basis of the work in the initial phase.

Some participants in the Thursday meeting feared that the EEC's references to coordination with negotiations in other groups could mean that not much progress could be expected in the TP Group, until a basis for actual negotiations in agriculture could be agreed upon and begin.

This latter, it is commonly agreed, is unlikely before mid-1988, until after the French elections are out of the way.