GATT CONTRACTING PARTIES WEIGH OPTIONS OVER ITC.

May 8, 1992

GATT CONTRACTING PARTIES WEIGH OPTIONS OVER ITC.

GENEVA, MAY 6 (TWN) -- GATT Contracting Parties are to hold further consultations among themselves and with the United Nations over of the International Trade Centre whose future has been thrown into doubt because of the unilateral decision of the UN Secretary-General Boutros Boutros-Ghali to downgrade the post of the head of the ITC, which is now run jointly by the GATT and UNCTAD.

The ITC was started by the GATT and when UNCTAD was established in 1964 was run as a joint GATT-UNCTAD operation, with the two bodies sharing the administrative budgetary costs, while the programmes were financed by UNDP funds and extra-budgetary resources from the developed countries.

This joint responsibility and sharing of the costs has now been thrown into disarray by the action of the UN.

Boutros-Ghali who decided to abolish all the UN secretariat posts of Assistant Secretary-General and having the same work done only by officials of the rank of Directors, extended this to the ITC and declined to appoint a senior Irishman, chosen earlier by GATT and UNCTAD at the rank of an Assistant Secretary-General Boutros-Ghali was also willing to offer the person only a one-year assignment at a time.

GATT Contracting Parties had expressed concern over this and had asked the Chairmen of the GATT CONTRACTING PARTIES and of the GATT Council to meet the UN Secretary-General and reverse the decision. The efforts of the two to meet Boutros-Ghali last April however failed.

At last week's meeting of the GATT Council, the Chairman of the GATT CPs, Lars Anell of Sweden, had reported to the Council on their inability, despite repeated efforts, to meet with Boutros-Ghali and discuss the problem.

Boutros-Ghali at a press conference in April had said that his doors were always open, a view that was repeated at the Council meeting by the Egyptian delegate.

In response to Boutros-Ghali's remarks about his "open door", Anell had told newsmen that "never had a door remained more closed to him than on this occasion".

Meanwhile the Irish candidate made clear that he was no longer available. The Egyptian deputy Executive Director who had been acting in April has also remitted his office, at end of his term.

The ITC is now being temporarily headed by a senior official of the rank of Director, Raju Makil.

At the GATT Council meeting, several of the industrialised country delegates, providing extra-budgetary resources for the running of the ITC, Canada and the Nordics among them, reportedly said that they would find it difficult to convince their authorities to continue funding of the ITC in such a situation.

It was agreed at the Council that the chairman of the Council, Amb. Balkrishan Zutshi of India should hold further consultations among CPs on how to resolve the problem.

In the absence from Geneva of Zutshi this week, Anell held consultations Wednesday on what could be done.

While ruling out the "option" of closing down the ITC, the consultations reportedly brought out four options:

* GATT acquiesces in the present situation, pay its share of the administration costs, but has no control over the administration of the ITC (which Boutros-Ghali's decision would involve);

* GATT withdraws from the ITC and allows the UN (through UNCTAD) to take over the ITC;

* GATT seeks to re-establish the old partnership and relationship with the UN, provide equal funding but with equal authority and responsibility;

* GATT taking over the ITC completely and run it by itself.

In the consultations, Anell would appear to have expressed the view, with which many others seemed to agree, that there was little hope of the third option succeeding unless Boutros-Ghali changes his mind and views the ITC and the administrative arrangements for it as apart from his scheme for re-organising the UN secretariat.

The U.S. too appeared to feel that the third option might not work and the GATT might have to consider the fourth option. This view was reportedly supported by Argentina and Colombia.

Egypt and Italy would appear to have suggested that any effort to find a solution should be in the context of the UN restructuring and the fact that the UN General Assembly had considered Boutros-Ghali's moves and had endorsed it in March.

(In fact the Assembly stopped short of endorsing the scheme, merely taking note of the "positive actions". The assembly had also set some criteria for the restructuring of the secretariat and called for a report on the programmatic impact as well as financial implications of the organisational changes).

However, Finland would appear to have questioned this and said that it would not be possible to get well qualified persons to run the ITC on one-year assignments and at the levels Boutros-Ghali had decided upon. UNCTAD, it was noted, had probably five or six officials of equivalent rank (D-2), but it could not be said they would have the same responsibility as the head of the ITC responsible for a $ 50 million annual programme.

As one of the donors, the Finnish delegate reportedly added, his country would like to see the ITC headed by a person who could run it efficiently and effectively.

Colombia reportedly suggested that the participants could ask their colleagues in New York to raise the issue at the forthcoming meeting of ECOSOC. But others felt that this would bring the General Assembly directly into a situation of confrontation with the Secretary-General.

Some of those involved in the consultations, later said that given the fact that the UN Secretariat reorganisation embarked upon Boutros-Ghali has been masterminded by the United States, it would appear that the situation as it has developed might have the result, whether intended or not, of more parts of the UN dealing with economic issues going out of its ken and into the hands of the GAIT and the Bretton Woods institutions.

Some of the Third World countries fear that if the ITC were to pass into the hands completely of GATT, it would enable application of further "conditionalities" on the Third World before projects and programmes of export promotion now undertaken by the ITC are put into effect.