Nov 8, 1986


GENEVA, NOVEMBER 6 (IFDA/CHAKRAVARTHI RAGHAVAN)— A large number of countries are reported to have expressed concern Thursday over what they saw as arbitrary use by U.S. of article XXI of the general agreement to impose sanctions against Nicaragua.

The criticism of the U.S. actions came at the meeting of the GATT Council when it took up consideration of the report of a panel that went into the dispute raised by Nicaragua over the U.S. trade embargo.

Several of the countries that spoke at the Council participants at the meeting said, also called on the U.S. to end its trade embargo against Nicaragua.

The council was unable to take any action, and the issue would continue to remain on the Council's agenda, according to GATT sources.

The chairman of the GATT Council is to conduct informal consultations on the action to be taken.

A GATT panel chaired by Amb. Martin Huslid of Norway, found itself unable to give any relief for Nicaragua in view of the terms of reference which precluded it from judging the validity of the U.S. action in invoking article XXI of the general agreement for its trade embargo.

The panel had however raised some general issues arising out of the case, including possible interpretation by the GATT Contracting Parties of article XXI to restrict its use and prevent abuse.

The panel had also said irrespective of the right of any Contracting Party to take action under article XXII actions such as that of the U.S. against Nicaragua was contrary to GATT aims.

When the GATT Council discussed the panel's report Thursday, the Nicaraguan Vice-Minister for Foreign Trade, Orlando Solorzano is reported to have urged the Council to ask the U.S. to remove the embargo.

The Council, Solorzano is reported to have further urged. Should agree that special support should be made available to Nicaragua by GATT Contracting Parties who wished to help redress or compensate Nicaragua for the damage caused to its economy by the U.S. action.

The GATT Contracting Parties, he suggested, should also undertake to provide an agreed interpretation into the use of article XXI.

The U.S. delegate, Amb. Samuels, is reported to have insisted that the Council should merely adopt the report of the panel, and take the issue off the GATT agenda.

In the U.S. view trade sanctions imposed by a country for what it considered to be its legitimate security interests could neither be challenged in GATT nor adjudicated by a panel.

This U.S. view, participants later said, did not find much support.

Even those who agreed on the right of any Contracting Party take action to safeguard its essential security interest and invoke article XXII agreed that those doing so should exercise restraint. Several of them also felt that the issue posed by the panel, namely, how in such cases the Contracting Parties could act needed to be gone into.

Even the European Community which supported the U.S. view that the GATT Council could not limit the right of any Contracting Party to take action to safeguard its security interests, appeared to share concerns about "arbitrary use" of the powers under article XXI, participants said.

Some participants also interpreted the remarks of Amb. Tran Van Thinh of the EEC as expressing sympathy with Nicaragua’s plea for compensation and help.

Nigeria and a number of other third world countries are reported to have specifically urged the U.S. to withdraw its embargo.

The Nigerian delegate is reported to have pointed out in this connection that the UN General Assembly and the World Court at The Hague had found the U.S. action to be unjustified.

A super-power like the U.S. could not claim that its security was threatened by a small third world country like Nicaragua.

Argentina supported by several other countries, supported the view that in the new round, where examination and review of GATT articles was on the agenda, the question of review of article XXI and arriving at an agreed interpretation of the circumstances and conditions for its invoking, should be taken up.