Oct 2, 1990

THIRD WORLD GATT MINISTERS TO MEET IN GENEVA NOVEMBER 5-6.

GENEVA, SEPTEMBER 30 (BY CHAKRAVARTHI RAGHAVAN)— Third World Ministers in charge of GATT Affairs are to meet in Geneva November 5 and 6 to undertake an evaluation of the Uruguay Round negotiations and agree on proposals for pursuing their common objectives in the Round.

The decision to convene such a meeting was taken in New York on 28 September at a Ministerial meeting of the Group on South-South Consultation and Cooperation (G-15) and with participation of other Third World countries. The New York meeting, just nine weeks before the scheduled conclusion of the Uruguay Round has in effect identified a set of common objectives and concerns around which the Third World countries could, even at this late stage, take a coordinated stand inside the Uruguay Round Negotiations and safeguard their collective trade and development interests.

Convened by the Steering Committee of the G15 (Malaysia, Senegal and Venezuela), the New York meeting was attended by 23 countries (Algeria, Argentina, Brazil, Chile, Colombia, Cote D’Ivoire, Egypt, India, Indonesia, Jamaica, Malaysia, Mexico, Nigeria, Pakistan, Peru, Philippines, Senegal, Tanzania, Thailand Uruguay, Venezuela, Yugoslavia and Zimbabwe). The Foreign Minister of Venezuela, Reinaldo Figueredo chaired the meeting.

As is now the practice with such meetings (whether of the North, South or North and South), there was no agreed statement or communique but a Chairman's summing-up.

In the four years since the launching of the Uruguay Round, the summing up, outlining the crucial common objectives of the Third World, in effect its minimum demands, is the most coherent one evocated by the Third World over the Uruguay Round.

Both before the launching and since, the Third World countries have generally shied away from meeting together among themselves to consider the Uruguay Round issues and form a common view, except in terms of vague generalities.

The South Commission in its statement in Mexico City in 1988 had called on the Third World countries to cooperate with each other over a large number of issues where their interests were common. There was however no great enthusiasm within Third World governments for acting on this - with many of them trying to pursue their own individual aims and preferring meetings with the North rather than a meeting of the South Ministers alone. It was only in March this year that at India’s initiative senior officials from a group of Third World countries had met in New Delhi when some common views emerged. The participants at the New Delhi meeting agreed to continue their processes of consultation and coordination, started at the New Delhi meeting, through a further series of meetings. Their Geneva delegations were asked to consult and coordinate regarding timing and venue.

At their first summit in Kuala Lumpur, in June, the G-15 agreed to "closely consult each other and coordinate our efforts" to achieve a "balanced and successful outcome" of the which would take into account "the concerns and needs of the developing countries". But that summit statement did not attempt to identify the common objectives and concerns of the Third World around which a unified position could emerge. The New York meeting has made progress in this direction and could constitute a common platform.

The countries represented at the New York meeting represent various political and economic leanings and weight. Their coming together in what would be a common platform for the Round is probably very significant, even at this late stage.

GATT observers note that the New York meeting was staffed by Foreign Ministries, and in the Third World, as in the Industrial, there is often a battle for turf between Foreign Offices and Trade Ministries and, in relation to the Uruguay Round - whose scope goes far beyond trade and encompasses domestic production, distribution and even culture - between trade and other substantive Ministries. But if the Ministers for GATT affairs of these countries (in some cases Trade Ministries, in others the divisions of their Foreign Ministry dealing with international economic relations) get over their turf battles and follow up on the New York meeting, it may yet be in time for salvaging the Third World's future and prevent its economic recolonization, the observers note.

The current Gulf crisis, whose economic consequences are only now being better perceived, has already cast its big shadow over the Round. But even more it has weakened the capacity of the United States, both to pursue its political objectives of lining up support in the non-Industrial World against Iraq and to pressure the same countries to yield to it in the Uruguay Round.

But it is not very clear whether some of the capitals concerned are aware of this or whether being aware they might use the leverage far some very short-run benefits of emergency aid at the cost of their country's medium and long-term future sovereignty.

The Chairman’s summing up at the conclusion of the New York meeting, said the participants had expressed "apprehensions" concerning the nature of the multilateral trading regime that would emerge from the Round (if the proposals and ideas of the leading major Industrial Countries go through).

Such a regime, the participants were concerned, "might have less to do with trade liberalisation and market access but rather could serve to legitimise a system of managed trade". The areas of concern identified were the push for selective safeguards, attempts to secure for importing countries greater flexibility to applying anti-dumping and countervailing measures, incorporating obligations on intellectual property rights, investments and trade in services to impede Third World access to technology and efforts at development.

While acknowledging that individual countries might have their particular set of priorities in the Round, the summing-up set out some common objectives of the Third World: * Market accesses concessions to the Third World to enable expansion of their exports;

* A safeguards agreement excluding any possibility of discrimination, and rules on anti-dumping and countervailing to eliminate scope for harassment of Third World exports; * A multilateral framework on services that would enhance competitiveness of Third World service firms and enable them to gain effective access to world markets;

* A TRIPs agreement that would ensure access to technology and pursuit of public policy and social objectives;

* Reform of Agriculture to secure improved and secure access to markets for Third World countries, encompassing the developmental role of Agriculture in these countries and mitigating the negative impact on net-food importing countries;

* Agreed programme for phase-out of MFA and reintegration of this trade into the GATT;

* A TRIMs agreement that would recognise right of Third World to impose conditions on foreign investors;

* Continued flexibility to the Third World countries to invoke the present BOP provisions in GATT; and,

* A legal structure for implementation of the Uruguay Round accords which would preclude unilateral or cross-sectoral retaliation between trade in goods and measures on IPR protection, investment and services. With reference to the last, the New York meeting also came out against the EEC proposals, backed by some other ICs, to use the Uruguay Round and the Brussels meeting for a commitment to make the GATT into a Multilateral Trade Organisation (MTO) to implement the Uruguay Round and thus provide scope for the ICs to do such cross-retaliations.

The participants instead called for initiatives at the current UN General Assembly session and UNCTAD-VIII in 1991 for discussions towards a comprehensive International Trade Organisation. The following is the text of the Chairman's summing-up:

1. The Uruguay Round, the eighth and by far the most ambitious and complex round of multilateral trade negotiations under the aegis of GATT is drawing to a close. The outcome of the Round is indeed bound to have an enormous impact on the patterns of trade, production and investment. Participants at the Ministerial meeting of the Group of Fifteen recognised the importance of ensuring that the development dimension is incorporated into the multilateral trading system as a result of the Uruguay Round. 2. The Uruguay Round provides a unique opportunity to restore credibility to and promote a truly open, viable and durable multilateral trading system that is conducive to the development objectives. This opportunity must be seized by the international community in order to generate a new consensus on international economic cooperation in the field of trade and development. This consensus should promote both benefits for all its member states and opportunities for a meaningful participation of developing countries in the international economy.

3. The participants expressed apprehensions concerning the nature of the new multilateral trading regime that would emerge from the Uruguay Round. Their concern was that such a regime might have less to do with trade liberalisation and market access, but rather could serve to legitimise a system of managed trade through selective safeguards and increased flexibility for the imposition of counter.