Feb 7, 1991

URUGUAY: SEEKING "POLITICAL PACKAGE" FOR TRADE NEGOTIATIONS.

MONTEVIDEO, FEBRUARY 5 (TWN/ROBERTO BISSIO) – Hector Gross-Espiell, the Uruguayan Foreign Minister and chairman of the Ministerial-level meetings of the Uruguay Round Trade Negotiations Committee (TNC), is travelling to Geneva soon to shape-up a "political package" to enable the U.S. administration to get an extension of its fast-track authority.

When this is achieved, and by when the Gulf War is expected to come to an end, the stage would be set for the multilateral trade negotiations to be started or re-started.

This assessment has been provided after last weekend's informal regional meeting at Punta del Este on the future of the Uruguay Round negotiations, which collapsed at Brussels last December over the agricultural trade issues.

The meeting organised under UNCTAD's Uruguay Round technical assistance programme for the Latin American and Caribbean region had been originally aimed at enabling discussions at ministerial level among the countries of the region, the U.S. and EC. But the Gulf War and other preoccupations, including perhaps U.S. and GATT views on an UNCTAD role, resulted in the meeting being attended mostly by regional representatives at vice-ministerial or lower levels and with few of the key Latin negotiators from Geneva.

Prior to the regional meeting, the EC external relations Commissioner, Franz Andriessen, had visited Punta del Este where he held first separate meetings with the key Latin American Cairns Group members and later met with all of them and Mexico.

The discussions and clarifications he provided seemed to provide little ground for hope that in any renewed negotiations at Geneva, the EC would now be more forthcoming on agriculture than at Brussels, but the hope was "dangled" that some progress could be expected in future when the EC's plans for reforms of the common agricultural policy go through.

After his meetings in Punta del Este Andriessen had travelled to Washington where he had met with the U.S. Trade Representative, Mrs. Carla Hills.

Before the Latin American regional meeting began, high Uruguay officials would appear to have had length telephonic conversations with Mrs. Hills and had provided the regional meeting with an assessment of the Hill-Andriessen talks and the U.S. ideas.

Latin American sources present at the meeting and the briefings told TWN that U.S.-EC talks, and the Gulf War situation where the U.S. was trying to maintain the European alliance and get funds from Germany and Japan to fight the war, meant there could be no confrontations or pressures over the Uruguay Round.

This in effect implied that the negotiations might be prolonged, if the U.S. administration gets fast track authority, or could be quickly wrapped up with a modest global package (which for the U.S. and EC would have to include ambitious results in intellectual property negotiations) and a formulae for continuing negotiations or starting a new one on unfinished business after the EC completes its internal cap reform by which time the Gulf War would be over and the economic aftermath would be clearer.

Another alternative was to acknowledge failure and wind up the Uruguay Round, a prospect that no one liked. Even if the Round is to collapse, no one wanted responsibility for formally ending it.

As a result, the regional meeting ended without producing the expected blueprint or alternatives to avoid the collapse of the Round and renew the negotiations adjourned sine die at Brussels.

Gross-Espiell said that Latin America had a united common stand and that "there is still time to produce global agreements and save multilateralism, with steps forward in all areas of negotiations, if all parties are less ambitious in their demands".

Dadzie said that the final outcome of the Uruguay Round should show "a balance between the (demands of) developed and developing countries".

"A positive outcome of the Uruguay Round", he added, "would be a defeat of protectionism and the fragmentation of the world trading system as well as a counterweight to present recessionary trends in the world".

In private, Latin American delegates were pessimistic about the chances of reaching any agreement before 1 March and spent most of them time studying scenarios of some new negotiating round to be started after the end of the Gulf War when Europe might improve its offer of cuts in agricultural subsidies and Latin America would take the lead in convincing the rest of the Third World to soften its stand on the new issues of investment, services and intellectual property.

A view that came out after the meetings here was that the Uruguay Round could come to an end without spectacular achievements but without a formal collapse either, and the door would be open to start a new round after the Gulf War.