Feb 11, 1991


GENEVA, FEBRUARY 7 (BY CHAKRAVARTHI RAGHAVAN) – The U.S. appears to be sending some contradictory signals to its negotiating partners here over the resumption of the Uruguay Round talks.

President Bush in his speech at the Economic Club in New York and in answering questions spoke positively about the GATT processes and of the need to get the fast track extended.

Last week, after GATT Director-General Arthur Dunkel’s consultations in Geneva with officials from the U.S., EC and Cairns Group members it was said that the idea of evolving a platform for agricultural negotiations had been given up (because of U.S. and EC differences) and that the U.S. would now secure extension of fast track authority to enable negotiations to resume in the light of the EC's own internal reform proposals.

In this view it was said that excepting to start at technical level negotiations in agriculture, and may be cosmetically in a few other areas, the idea of a quick mini-package before 1 March (the date by which the U.S. has to seek extension of its fast-track authority) was no longer there, and serious negotiations could begin only after May.

However European and Third World sources said Thursday that the USTR, Mrs. Carla Hills was now saying that the negotiations should show progress in some key areas before March 1 to enable her to persuade Congress to extend the fast-track authority.

She was also said to be asking the EC to move on agriculture, go beyond its Brussels stand and agree to negotiate and commit itself to reductions in all three areas - domestic support, border protection and export subsidies.

In January when the EC Commissioner Franz Andriessen had met with some leading Latin American Ministers at Punta del Este, he had told them individually and collectively that the EC would not and could not move on agriculture beyond its offers at Brussels and that this should not be made an excuse by others to block the negotiations and reach agreements in other areas.

This was not acceptable to the Latin Americans who conveyed their own negative reactions to Andriessen.

Later, after the Andriessen visit to Washington and talks there with Mrs. Hills, the U.S. reportedly sought to persuade the Latin Americans that the EC would not be able to move but that some reforms of the CAP were under way in any event. The U.S. also reportedly advised the Latin Americans Cairns Group members about the fact that within the U.S. itself sugar and other interests did not support radical reforms in agriculture either.

Latin Americans understood from all this that the U.S. was expecting the Latin Americans and other Third World nations to move on the "North-South" issues in the round (intellectual property, investments, services and GATT rules), in effect to compensate for the U.S. inability to get agriculture concessions from the EC, so that the overall package was saleable to the U.S. Congress.

This was not acceptable to the Latin Americans.

An EC delegation is currently in Washington to discuss bilaterally with the U.S. on the Uruguay Round issues, but it does include anyone from the agriculture division.

There are some fears here that the U.S. and EC might be trying to reach an understanding on the modus vivendi to re-start the negotiations without the EC advancing on agriculture.

Earlier some of the Latin American Cairns group members had been willing to compromise on the "North-South" issues if they gained on agriculture.

But what is being sought now is a case of their not getting anything in agriculture, but in the belief they may gain something in future from the EC's internal reform processes, they and other Third World countries should "compensate" the U.S. (and the EC) now in the new areas, some of them said.