Nov 26, 1982





Geneva Nov 24 (IPS/Chakravarthi Raghavan) -- Third world countries would have no objections to 'national studies' on services issues, but could not accept involvement of GATT in such an exercise, and the prejudgment that trade in services should be under GATT rules, framework and principles.


This position was reiterated Wednesday evening by Amb. Fillip Jaramillo of Colombia, the spokesman of the Third World group at a press briefing.


Both Jaramillo, and other GATT sources, said that while the Canadian Chairman of the CPs' ministerial session, Foreign Minister Allan MacEachen, had been having some individual consultations, there had been no consultations or negotiations so far on the draft declaration recommended to the ministers by the GATT Council, and some of the changes proposed by some.


Jaramillo did not believe that the compromise text could be changed further, in any particular direction, nor could he envisage any solution over the US demand for GATT work programme on services and investment-performance requirements.


Jaramillo's remarks at a press briefing came at the end of the first day of the GATT Ministerial, addressed by some 27 ministers, the executive heads of the IMF, World Bank.


Earlier there had been inaugural speeches by the Canadian chairman, the President of Switzerland, Ritz Honneger, and the Director-General of GATT.


The speeches inside the plenaries, and the lobby talks and press conferences through the day, reflected the somewhat tense atmosphere involving protectionist issues, the agriculture issues, and the orchestrated attempt of the industrialised countries to pressure the Third World to support GATT studies in services, accept consensual selective safeguards, and for the socalled NICs to open up their own markets to industrialised countries.


All the Third World countries who spoke Wednesday reiterated their demands for firm commitments on standstill over further protectionist measures, agreed dismantling or phase-out of existing measures, priority attention in GATT to unfinished business of the Tokyo Round, full implementation of Part IV of GATT and the special and preferential arrangements for the Third World under the Tokyo Round agreements, disputes settlement, and an effective safeguards agreement or understanding.


However, the Philippines Trade and Industry Minister, R.V.Ongpin, the opening speaker of the ministerial, gave support to the US-EEC-Japanese views for selective safeguards by mutual agreement, or consensual safeguards. He also supported the North-South round of trade negotiations suggested by the USA.


But all other Third World countries, including Singapore of the ASEAN, rejected this approach, and insisted on a safeguards system that fully respected GATT's non-discriminatory MFN principles.


The case against GATT studies on services and performance requirements was put forward most forcefully by the Indian Trade Minister, Shivraj Patil who said "unlike trade in goods, trade in services is intimately linked with flows of factors of production - international flows in capital, labour and technology. Surely if one wants to discuss in a comprehensive manner issues related to trade in services, one has to discuss, among other things, issues related to immigration policies, technology flows policies etc ... GATT has no mandate to discuss these issues... For many of them, there are other competent organisations such as UNCTAD which are doing excellent work in these areas."


Patil also took an equally strong stand on 'trade-related performance requirements' and said Third World countries had to take measures to improve their national economies - increase domestic value added in their different industries, promote exports, specially of manufactures, etc. These were part of their development strategies and they needed the freedom to - deploy different policy instruments to accelerate their development.


Pakistan's Mahbub Ul Haq took a similar stand, and said a new and comprehensive round of trade negotiations, including trade in all products and in all forms, should be launched eventually under the umbrella of a new institution with an enlarged mandate and sufficient disciplinary powers, but in the interim under the joint auspices of UNCTAD and GATT.


Haq said 'trade in services' and all other forms of trade, apart from trade in goods, must include all factors of production, including migration of labour, and if any studies were needed they should be conducted jointly by UNCTAD and GATT.


Haq till recently was a World Bank official, and left the Bank and is now the Planning Minister of Pakistan.


Earlier, Brazil's Foreign Minister, Ramira S Guerreiro, while presenting a strong case against GATT involvement in services and investment issues, appeared to be yielding ground to the USA in a limited way over studies in GATT on it.


In an obvious reference to the United States, which has put its prestige behind it, and the talk of the 'importance' to the administration of winning some action on it in GATT, Ramiro Guerreira said Brazil could agree in a 'gesture of compromise' for examination and investigation of new issues of 'great importance to certain countries' in the new areas suggested, but in a format 'that does not prejudge the results or be detrimental to the basic interests of others'.


Many other Third World countries who spoke Wednesday, largely skirted the issue, excepting for Sri Lanka's Athulathmudali, who without referring at all to services and performance requirements issues, insisted on GATT work programme being confined to subjects within GATT's competence.


Columbia's Jaramillo's remarks at his press briefing, on the position of the group, came in reply to questions over 'rumours' of a slideback in some Third World countries on this issue, and arising out of the Brazilian remarks. Jaramillo was quite forthright in reiterating the group's position and a Brazilian diplomat was by his side when he made that remark.


In an institution, mainly representing the postwar old world economic order, the Indian minister also threw a spanner into the works by his remarks that the future work programme of GATT, among other things, should help 'restructure international economic relations for the achievement of the NIEO, an objective to which all countries were solemnly pledged'. India was the only country to put the NIEO on record and notice in GATT.


In other remarks, the US and EEC took a strong position on the agriculture issue, while the EEC was equally strong in rejecting it. Jaramillo in his press briefing suggested these were two extreme positions and, as in other matters, the draft declaration contained a compromise position that was the best that could be done now.


It was for these reasons, that despite their own dissatisfaction, the Third World group supported the adoption of the draft declaration as recommended by the GATT Council.