Feb 30, 1993



Geneva 2 Feb (Chakravarthi Raghavan) -- Consultations have begun among Contracting Parties to the GATT on the question of choice of a Director-General when the term of the present incumbent, Arthur Dunkel comes to an end in July 1993, according to GATT sources.

Technically, the consultations could well result in Dunkel being given another shorter extension and asked to continue and complete the Round over the next few months, within the present parameters.

But if some unconfirmed reports that the Americans do not favor an extension prove to be correct, or even if Dunkel declines, it would be an indication that the conclusion of the Round is not around the corner and could take a few months if not a longer time.

As one observer put it, if the US administration does not quickly make up its mind, and get authority from Congress to complete the negotiations within the present Punta del Este mandate, it would really be a new Round and if it gets under way and successful could become a "Clinton Round".

Under GATT procedures, the GATT Director-General is appointed by the CONTRACTING PARTIES, and the Chairman of the CPs has to hold consultations at least six months before expiry of the term.

According to GATT sources, in accordance with this requirement, the Chairman of the GATT CPs, Amb. Balkrishan Zutshi of India has started consultations and is due to hold further meetings this week.

Dunkel's term which was to have ended in December 1992, was extended last year till end of July 1993.

In December 1991, Dunkel had 'confirmed' to GATT CPs that his earlier decision to treat his 'present mandate' (at that time end December 1992) was "final, remains irrevocable".

At that time, the GATT spokesman had explained that by making this decision and conveying it, Dunkel "was freeing his hands to put the strongest pressure on the processes of the Uruguay Round, that he will not be playing the 're-election game'...and (was thus) placing himself in the best possible position to get results by the end of the year".

In December 1991, Dunkel had presented his 'package' of texts -- the Draft Final Act -- and had hoped that it would be accepted as is by everyone.

However, it soon became clear that this would not be possible, and he got clear indications of this in the January 1992 TNC. At that time while a few announced they had decided to accept the text as is, the EC made clear it wanted changes in the agriculture text, the US said it had concerns in other areas and India had said it had concerns on intellectual property, textiles and clothing and agriculture among others.

Dunkel had then announced a four-track process, with changes in the text to be dealt with in the fourth-track, but changes only be consensus. Even so some had made clear, that without changes the Dunkel text could not accepted either as a consensus text.

However, there had been some hope that the US and EC would quickly settle the agriculture issue, and the Round could still be wrapped up before the end of Dunkel's term, with some minor and minimal changes.

But by summer of 1992, it became clear that this was not likely.

And in July 1992, (Dunkel was asked to continue and his contract was extended till July 1993.

When the US and EC reached an 'understanding' on agriculture, soon after the US Presidential elections (and the defeat of Bush), there was a view that the negotiations in the Round could be quickly wrapped up before President Bush left the White House.

But this was on the basis that except for the agriculture text, no other parts of the Dunkel package would be opened up for change, and the negotiations on market access and initial commitments on services could be quickly completed.

But as had been known from January 1992 (when the TNC met to look

at the Dunkel draft text) it was never on the cards that the text

would survive and be accepted without changes, and that negotiations for some changes would be needed.

When the negotiating process resumed in Geneva, in the light of the Blair House accord, it became clear, even by early December last year, that apart from agriculture, there were other changes to be considered, negotiated and settled and that the 1 March deadline was no longer feasible.

But the US official negotiators continued to say, till the last day of the Bush administration, that they were ready to negotiate and conclude, but that others including the EC were 'rigid', a charge that the EC and others made against the US.

Dunkel himself would make no comments on prospects of concluding a deal before 1 March, merely saying repeatedly that all the elements needed for political decisions were there.

On January 19, at a press conference after the TNC had met for its 'stock-taking' on January 19, and took a pause waiting for signals from the new administration in Washington, Dunkel refused to commit himself on when he thought the negotiations could be concluded, repeatedly noting that the TNC while on call, and while all participants had expressed their determination to resume negotiations and conclude it, had decided to set no more target dates lest the media should announce one more deadline having been missed.

At that time, a Canadian newsmen in an attempt to pin down Dunkel had referred to the US fast-track authority deadline of 1 March (by when the President has to notify Congress of the agreement) and Dunkel's own term of office ending July.

Dunkel replied "I am wedded to the fast-track" 

But this left newsmen wondering whether he was saying that he would not be there beyond his term, or implying that he would be there if the fast-track has to be extended to enable the new administration to conclude a deal.

The EC and its new Commission for GATT and foreign economic relations, Sir Leon Brittan continued to assert that negotiations could be concluded in time for the US fast-track deadlines, with some flexibility from the Democratically controlled Congress to the President Clinton on sending up to Congress the full details of the new Uruguay Round accords.

Last week, while speaking at the Davos symposium of the World Economic Forum, Dunkel was reported as saying that given the considerable amount of technical work yet to be done, the negotiations could not be concluded within the 1 March fast-track deadline.

Some GATT sources had speculated that if the new administration was really serious about concluding the Round, it would need to get a new fast track authority, say till end of the year (which would mean the deadline for notifying Congress moving from 1 March to 1 September or 1 October), negotiations could be resumed early in March or April and concluded by September.

In such an event, it was thought it would be foolhardy to get a new person to head the organization at that crucial time -- since any new person would need some time on the job to personally know the negotiators and establish rapport enough to play any role in promoting an agreement.

In this view, there had been some suggestions that Dunkel could again be asked to continue for 3-6 months.

Since then, there have been some unconfirmed reports that the Americans, would not favor Dunkel's term to be extended, but would want a committee of the CPs to be set up charged with the task of finding a successor, who should be 'dynamic' and provide leadership to conclude the Round quickly.

Considering that the delays in concluding the negotiations lie with the two majors, the view that a new 'dynamic' personality, who would be able to contact and talk to Ministers directly and promote an agreement, would be to place too much responsibility on international civil servants and too little on the governments who have to negotiate.

But if reports of the US position and plans are correct, it would indicate that the new administration has no intention or hope of quickly concluding the Round.