Feb 24, 1987

URUGUAY ROUND NEGOTIATIONS MAINLY TRIANGULAR EEC.

GENEVE, FEBRUARY 20 (IFDA/CHAKRAVARTHI RAGHAVAN) The Uruguay Round of Multilateral Trade Negotiations would be mainly triangular amongst the EEC, U.S. and Japan and Japan would have to "give most", according to the perception of the European Economic Community.

This view of the Community became known here after a background briefing provided by the EEC chief spokesman in GATT, Amb. Tran Van Thinh, earlier this week to EEC new correspondents.

Also, the outcome and benefits of the negotiations would not automatically become available to everyone, and other participants would have to pay a price for participation in the round.

Third world sources interpreted this as confirming their fears that the new round would not address their concerns, but essentially an effort at "carving up" the markets among the big three, and in effect creating a super-GATT through conditional MFN (most-favoured-nation) treatment, as after the Tokyo round through new codes and special arrangements within GATT.

Tran is reported to have stressed that unlike past GATT rounds, the MTNS this time was not about technical GATT matters like tariff and non-tariff barriers, but on basic economic questions.

And trade policy issues could not be separated from basic economic issues of stability in foreign exchange markets and solutions to problems of indebtedness.

The EEC spokesman would appear to have noted that the community had raised the issue of monetary and financial stability and stability in exchange rates and need for parallel actions both in the preparations for the new round and at Punta del Este too.

While these issues could not be solved in GATT, their impact on trade would have to be looked at, and a start made elsewhere for a solution of these problems.

Tran would appear to have ruled out any prospects of a "faster track" approach to agriculture negotiations, and said that the entire negotiations in goods had to be seen as a package, and the results of the negotiations would have to be implemented as a package at the end of the round.

The Punta del Este declaration had set a four-year limit for conclusion of the round, but before the results could be implemented from January 1, 1991, there would have to be a start to, and progress towards solving the problems in the areas of foreign exchange rate towards solving the problems in the areas of foreign exchange rate stability and debt issue, both of which had an impact on trade.

In the EEC view, the new round was not about technical GATT issues like tariff and non-tariff measures, but about wider economic issues trilateral affair involving the U.S., the EEC and Japan.

By the time of the conclusion of the round, the whole of Europe would be a free trade area encompassing the EEC and the EFTA countries.

Agriculture was a major issue, and solutions would depend on the U.S., and EEC and EFTA. Others like the Cairnes group would at best be on the sidelines.

What the third world countries would get out of the Uruguay round would very much depend on what they would give.

Unlike in the past, they could not expect to get benefits merely through the most-favoured-nation (MFN) clause of GATT or a general application of benefits to them, through the special and differential treatment and application of chapter four of the general agreement.

Concessions given by the EEC to the U.S. or Japan would not be automatically available to others, but would depend on the "transparency" of their import regimes and how much the third world countries would pay to participate and benefit from the negotiations.