Jan 29, 1993



Geneva 14 Jan (Chakravarthi Raghavan) -- GATT Director-General and Chairman of the Trade Negotiations Committee (TNC) Arthur Dunkel is due to resume Thursday evening his consultations with the select group of top negotiators from key countries looking into proposals for changes in the Draft Final Act of Uruguay Round agreements, according to GATT sources.

The meeting of the Trade Negotiations Committee set for 15 January has been put off by Dunkel to 19 January, ostensibly to give time to the US and EC to reach some accord in their bilateral market access negotiations which, it is being suggest, would un-block the deadlock in the negotiations.

Meanwhile a senior US official indicated to newsmen Thursday (ahead of the Dunkel consultations) that the conclusion of the Uruguay Round agreements could be several months away, thus putting to rest the talk of concluding an outline deal before President Bush leaves office on 20 January.

All that one could hope for when the Trade Negotiations Committee (TNC) meets next week, the senior official suggested while talking on background, would be that "we will have a much better sense of the major stumbling blocks to an agreement... we will have a much clearer picture of what the universe of proposed changes will consist of."

Noting the amount of detailed work that still remained to be done over the next several months on the package as a whole, the official said that concluding the negotiations before the 1 March US Congressional fast-track authority deadline might be technically feasible "but will be politically difficult."

Also, Third World sources said that while the US and EC were continuing their bilateral talks on market access, the view that the US-EC accord would unblock the deadlock and enable quick conclusion of the six-year old negotiations could prove to be as illusory as earlier identification of one or the other issue.

With the US holding out for its sectoral approach to tariff cuts --the zero-to-zero option in sectors where the US and EC (and Japan and Canada) are major traders -- to achieve the overall target of 30 percent reduction in average tariffs and the EC pushing for cutting tariff peaks in textile products it trades, and with developing countries by and large already having been forced by the IMF and the World Bank to cut unilaterally their own tariffs on imports (mainly from the North), the result could be even more unbalanced.

The Dunkel group which has been holding meetings since Monday, recessed Wednesday, but is due to resume Thursday to continue its discussion of the proposals put forward by the US and several others. They would so far appear to have looked at proposals for changes in rules on sanitary and phyto-sanitary restrictions on agricultural imports, on technical barriers to trade, anti- dumping, subsidies, textiles and trade in intellectual property.

Proposals for changes in the texts on agriculture (on which the US and EC agreed in November, the so called Blair House accord, and on which text of changes in legal language were put forward in December 1992), on services and on the Multilateral Trade Organization (MTO) are expected to be taken up.

Sources said that while no one now expects any accord -- political or outline package -- to emerge even within this small group before the Bush administration lays down office next year.

But the discussions and frank exchanges within this 'closed circle' has atleast enabled the principal protagonists to understand the nature of the changes specifically sought, their implications as the others see it as also the extent of opposition to any change.

The exercise would help to identify the problems to be resolved when the new US administration takes over and tries to put its imprint on the talks and conclude them.

Dunkel as well as the major players, while agreeing on the need to make changes in the agricultural text (in line with the Blair House accord) wish to limit changes in other areas. The discussions within the group apparently have so far showed opposition from one or the other side to the proposals for changes.

Much would hence depend on the assessment that proponents of the changes make of the opposition, whether they would give up the change and accept it, or manage to convey to the others the view that without the changes the accord would not command consensus.

But it is not even clear whether by the time the TNC meets on Jan 19 "to assess the overall progress...and to take stock", it would even be possible to arrive at a formal or informal paper or text of the issues yet to be resolved, and those resolved (and thus not to be reopened).

Even the limited number of parties involved in the 'Dunkel' consultations could preclude it.

The participants would appear to include the US, EC, Japan, Canada, Sweden, Switzerland, Australia, New Zealand (from the industrialized countries); Hungary (from east Europe); Argentina, Brazil, Chile, Uruguay and Mexico (from the Latin American region); Hong Kong, Korea, Singapore and India (from Asia).

The entire African region is represented in the talks only by Morocco.

Even Egypt, which has formally put forward changes it wants in the agreement on TRIPs, has not been called in. Similarly, Pakistan, which like India is objecting to the textiles accord, has not been called in.

And the debate on agriculture appears to be confined to the US and Cairns group Latin American component and, except perhaps for India, has not involved the range of African or other Asian developing countries who are not merely interested as exporters in one or other product, but also concerned over the impact of the agriculture text and the US-EC accords on their own agricultural development.