Jan 17, 1991


GENEVA, 15 JANUARY (BY CHAKRAVARTHI RAGHAVAN) — GATT Director-General Arthur Dunkel was "cautiously optimistic" Tuesday on triggering "resumption of work across the board" in the Uruguay Round negotiations which were adjourned indefinitely at Brussels on 7 December.

Dunkel gave this assessment at the informal meeting of the Uruguay Round Trade Negotiations Committee (TNC) but provided few details for the basis of his assessment and the meeting itself ended within a short time, hearing only comments from South Korea, Japan and Switzerland.

Interestingly, the chief negotiators for the U.S., EC, Canada and Japan were in town, purportedly for the informal TNC meeting, but perhaps for some quiet bilateral and quadrilateral talks.

The U.S. and EC it is reported are planning bilateral talks on the issue of services where there are some U.S.-EC differences. The U.S. has also been insisting that as part of the negotiations for settling a multilateral framework, there should be bilateral consultations among participants on initial market access commitments.

Switzerland which is pushing for a financial services agreement has also apparently planned over the next few days some plurilateral consultations. Some European sources suggested that any resumption of talks on the Round would all be more informal and plurilateral which in turn would mean even less transparency.

In his statement at the informal TNC, Dunkel, while leaning towards the European Community's approach for "global" negotiations, said that his consultations showed that negotiations could not be "genuinely resumed" without removing the blockages on agriculture and this required agreement among participants to establish a "platform" for agriculture negotiations.

"As soon as we have a genuine basis for negotiations in agriculture - and the sooner we have this the better - we can proceed on all outstanding subjects simultaneously", Dunkel said.

"I then hope very quickly to put in place a flexible and result-oriented programme of negotiations on the real stumbling blocks. This would be in keeping with the concept of 'globality'".

In his capacity as chairman of the official-level TNC, Dunkel had been mandated by the Brussels Ministerial meeting to intensive consultations "with the specific objective of achieving agreements in all the areas of the negotiating programme" and he was briefing Uruguay Round participants at an informal meeting of the TNC.

In providing what he himself called a "cautiously optimistic" assessment on the basis of his consultations so far (based mainly on his visits to Washington and Brussels), Dunkel said he proposed to continue consultations to determine how best to make rapid and substantial progress and that the TNC would remain on call and could meet at very short notice in the meantime.

Dunkel however did not push the idea which he had apparently sought to canvass Monday in his consultations with a group of Third World diplomats for restarting negotiations in all areas, in seven clusters, by next week or latest first week of February.

He had suggested this on the basis of what is reportedly the EC "concession" that it was ready to negotiate in agriculture of reduction of protection on all three aspects (domestic support, border protection and access to its markets and export subsidies) but that there should be start of negotiations on all issues.

At Dunkel’s consultations with Third World delegations, Brazil is reported to have been cool to this, making clear that unless a proper basis for negotiations in agriculture was established, they were not ready to re-start the entire negotiating process.

Other delegates also reportedly had told Dunkel Monday that it was not "realistic" to think of re-start of negotiations "next week", given the calendar of various other scheduled meetings and in any event many of the Third World delegations would need adequate notice to bring their experts from capitals.

EC Commissioner Andriessen is due to meet at Punta del Este 25-26 some of the Latin American countries - the members of the Cairns Group and Mexico. He is then due to travel to Washington and Ottawa for high-level talks.

A meeting of all Latin American ministers has also been scheduled for 30 January at Punta del Este, and invitations have been reportedly issued also among others to the U.S. and EC.

A GATT spokesman said Tuesday that while Dunkel might go to Punta del Este at that time, he would not be attending the conference. It was not clear whether this was because the meeting has been scheduled under UNCTAD auspices (under its technical assistance programme for the Uruguay Round).

A GATT spokesman however said (after the informal TNC) that Dunkel planned to start consultations from Wednesday and hoped the TNC could meet and restart negotiations next week, may be sooner.

The spokesman however added that Dunkel could not restart negotiations "artificially". Either there was a basis for negotiations on agriculture or there was not. He could only encourage the process but can't do more.

The viewpoint put forth by Brazil at Dunkel’s consultations Monday with a few Third World delegations was later endorsed at a meeting of the Cairns Group and Australia, as chairman of the group, was asked to convey this to Dunkel and probably resulted in Dunkel not openly pushing for re-start of negotiations at the TNC.

Some of Cairns Group members privately explained that an EC agreement to "negotiate" on all three issues was not enough. They had been purportedly doing it since the launch of the negotiations in 1986. Unless the EC went beyond this and indicated its readiness to modify its Common Agricultural Policy through negotiated commitments in all three areas, the other participants would find themselves in the same position as at Brussels and in the run-up to it.

Some GATT sources said that the "platform" may be no more than an EC Commission statement to "negotiate and enter into commitments" in all three areas - but without making a new offer or getting the clearance of its member-states.

After Dunkel’s statement, only three delegations - South Korea, Switzerland and Japan - reportedly spoke and all three underlined the need for early resumption of the talks and conclusion of agreements noting that time was not on the side of the negotiations.

Korea indicated that it was revising its stance at Brussels and would be putting forward new offers in agriculture. It also indicated it was willing to negotiate on tariff elimination by sectors (the zero option proposal of the U.S.).

But Japan seemed to stick to its position arguing that while it would be ready to participate in negotiations in all three areas, its non-trade concerns, meaning presumably import restrictions on rice and domestic support, would need to be addressed. Korea said it had also tabled offers on initial commitments in services and was ready to consider elimination of tariffs on a sector basis (the U.S. zero option).

The GATT spokesman said that (contrary to earlier programme) Dunkel would not be travelling Wednesday to Washington for consultations, but that he might do so later in the month.

The change in travel plans, some GATT sources said, was related to non-availability at this time of senior U.S. officials.

The GATT spokesman denied suggestions that Washington had said that its negotiators would not be available for any resumption of negotiations in the event of a Gulf war.

Though the informal TNC meeting was taking place even as the entire world seemed preoccupied with the issue of peace and war in the Gulf, there was apparently no reference to it at the meeting.

In his introductory remarks to the TNC Dunkel said that he had conducted consultations at different levels bilaterally and plurilaterally and in Geneva and in capitals as to the best way to restart the negotiations.

His contacts indicated that in all quarters there was "a firm desire" to press ahead with the Uruguay Round and this "desire" was not just a formality but had led to a re-examination of positions.

"I would go so far as to say that signs of flexibility which were missing before the Brussels Meeting - and at the Brussels Meeting itself - can now be detected", Dunkel said adding, "however, we must not deceive ourselves. Good intentions are one thing and real movement is another".

"It is evident", Dunkel said that, "when the need for flexibility is mentioned, this relates to many areas, even if agriculture seems to come first to minds. While I do not wish to take sides, my consultations lead me to doubt whether the negotiations as a whole can be genuinely resumed without the blockage on agriculture being removed".

"This being said, it is only realistic to recognise that in a number of areas apart from agriculture, a serious effort to bring positions closer together is also absolutely necessary. Without wanting to be exhaustive, I might mention the areas of access including tropical products, textiles, services, TRIPs and TRIMS, rules and institutional questions including settlement of disputes".

Looking to the future, Dunkel said the task of achieving agreements in all areas of the negotiating programme, in terms of the mandate given to him at Brussels, meant there was very little time at the disposal of the negotiators.

Experienced negotiators also knew too well that any suspension in a negotiating process had to be "very brief for political as well as practical reasons".

It was clear that "the trigger" for resumption of work across the board had to come from an agreement among participants on a "platform" from which negotiations on agriculture could proceed.

"I am, even now, in the process of intensive consultations to see if we can establish such a platform. At this stage I can only say I am cautiously optimistic".

"As soon as we have a genuine basis for negotiations in agriculture - and the sooner we have this the better - we can proceed on all outstanding subjects simultaneously. I then hope very quickly to put in place a flexible and result-oriented programme of negotiations on the real stumbling blocks. This would be in keeping with the concept of ‘globality’. Such an approach would also make the most efficient use of our time".

Dunkel added: "we really have only two scenarios before us".

"The first is a short and brisk negotiations to bring together all the elements of the final package of results as quickly as possible. I see no obstacles to this if governments show the political will to start negotiating immediately. I favour this option even though it will mean very concentrated and hard work from all of us".

"The second would be to see us being inadvertently dragged into a prolonged time-frame for negotiating and concluding the Round. We may not be able to avoid this if, for one reason or another, governments find it difficult to commence negotiations across the board straight away. The risk involved in such a scenario are too well known for me to repeat them".