Apr 16, 1987
CONCERN OVER TRADE WARS AND RETALIATIONS.GENEVA APRIL 15 (IFDA/CHAKRAVARTHI RAGHAVAN) -- Participants in the Uruguay Round negotiations, both industrial and third world, have expressed concern over deteriorating in the international trading scene due to threats of "trade wars" and unilateral retaliatory actions, and have warned of their negative impact on the MTNS. The concern reportedly was voiced Tuesday at the meeting of the Group of Negotiations on Goods (GNG), when it met to review the progress in the first round of meetings of the various negotiating groups in the MTNS in goods. The GNG decided on a schedule, covering the period April 27 to June 27, for the next round of meetings for the 14 negotiating groups, more or less on the same pattern as the calendar for the first round of meetings that ended last week. In order to ensure some flexibility, the chairman of on the issue of observers, the GNG, GATT Director-General Arthur Dunkel, was authorised to hold consultations, if needed, on the schedule. The GNG also decided in principle to invite the Secretary-General of the United Nations, the Secretary-General of UNCTAD, and the executive heads of the IMF and the World Bank, to be represented (as observes) at the meetings of the GNG in the initial phase of the negotiations (in 1987). Each of the 14 negotiating groups were asked to consider the question of inviting to their meetings as appropriate international organisations who could assist in their work. The recommendations of the negotiating groups are to be submitted to the GNG. In the general review of progress in the first round of meetings of the negotiating groups, participants are reported to have generally agreed there was "satisfactory progress", but expressed concern that "in the real world outside the situation had deteriorated". Singapore is reported to have referred to the spiralling of new restrictive measures, and retaliations and counter-retaliations, and is reported to have expressed concern. The multilateral system, Singapore reportedly said, was threatened and the surveillance mechanism was hardly functioning. "If bilateral solutions are to be enforced outside the GATT, and if major trading partners find it expedient to settle trade problems among themselves, we run the substantive risk of GATT suffering irreparable damage", the Singapore delegate is reported to have warned. A number of other delegates too reportedly shared this concern. Sweden, speaking for the Nordic countries, is reported to have agreed that the real world outside had not changed for the better, and there were "real risks of further regressive measures", and would urge restraint on all the trading partners. India also warned of the deterioration in the trading environment and rising trade tensions with "major entities ... on the brink of trade war more than once in these seven months". While there were repeated proclamations of faith in the multilateral trading system and pledges to preserve it, they also heard of developments in trade-policy with far-reaching significance for the system, but only through newspaper reports. And while there was talk of "sending the right signals" by the work in GATT, there was also "open advocacy of cartel-like arrangements, retaliation for alleged breach of cartelization, and renunciation of agreed principles such as non-reciprocity and non-discrimination". It was ironic that at the same time there were optimistic calls for "early harvest", Indian delegate is reported to have remarked. This was apparently with reference to the U.S. pleas for early actions in the round on some of the issues of interest to it -agriculture, services, investment, and intellectual property rights- and for a ministerial level meeting early next year towards this end. Expressing scepticism at this "event-planning" and new target rates, the Indian delegate reportedly complained that this "early harvest" appeared to emphasise only areas of predominant interest to some industrialised CPS. The idea of "new round for new issues" had been resisted by countries like India (in the preparations for the new round) and it was no longer alive, and "we would not like to see its ghost reappearing in an attractive garb of some catchy phrase", the Indian delegate reportedly added. If the trading system was to be strengthened it should be through significant and solid progress in traditional areas of key importance -safeguards, textiles and clothing, tropical products and agriculture. Everyone should abide by the Punta del Este mandate, and "resist the temptation to reinterpret it unilaterally", particularly on issues like trade-related investments, trade-related intellectual property issues, subsidies and MTN agreements and arrangements. Earlier, Hungary, Hong Kong, China and South Korea were among those who reportedly spoke in support of the "early harvest", though qualifying it by specifying the areas they wanted such progress. Nigeria had said that early harvests must cover all sectors, while Uruguay warned that "too early a harvest might result in an unripened fruit". Mexico felt that any "early harvest" could not be confined to one or two groups. The U.S. reportedly welcomed the support for the "early harvest" idea, but agreed that it could not be confined to one or two groups of subjects. it however invited an "earlier harvest" by participants signing the draft anti-counterfeiting code presented by the U.S. delegation. The EEC however cautioned against raising "false slogans" that would only raise hopes and dash them. "Early harvest", the EEC delegate reportedly remarked, in French conveyed the meaning of "precocious or premature birth" and unlikely to survive. Jamaica complained of lack of "full transparency", in various negotiations, and specially in agriculture. The Jamaican delegate also wondered whether all participants had the necessary mandate to negotiate on tariffs. Jamaica was also far from convinced that standstill was being observed or that the surveillance mechanism was working. Jamaica also was concerned at efforts to reinterpret the mandate of Punta del Este, referring in this connection to the efforts of U.S., EEC and other major industrial nations in regard to the negotiations on subsidies and MTNS codes. Earlier, the U.S. had reportedly sought to play down the role of the GNG, both in deciding and approving the calendar of meetings and in reviewing progress in negotiations, or in surveillance of standstill and rollback. This and matters relating to progress in negotiations, the U.S. delegate is reported to have remarked, was a matter for the trade negotiations committee. Referring to this, Jamaica underlined that insofar as the MTNS in goods was concerned, the TNC had "no legal status" and only the GNG could review and coordinate the negotiations in goods. Sweden reportedly agreed that the GNG had been entrusted with the coordinating and supervisory role in the MTNS in goods, and it should play an active supportive role, and not a passive one, in the conduct of negotiations. The Nordics also supported the idea of "early harvest", with priority for tropical products. But it would be the "substance and quality" of the early harvest that would count, the Nordic spokesman reportedly added. Supporting the GNG role, the EEC is reported to have said that "Uruguay round ballet can be choreographed only the GNG".