Oct 9, 1990

DUNKEL AND EC FAVOUR ONLY TIME-DEROGATIONS FOR THIRD WORLD.

GENEVA, OCTOBER 5 (BY CHAKRAVARTHI RAGHAVAN)— The GATT Director-General, Arthur Dunkel, appeared Friday to favour the view that the "differential and more favourable treatment" promised to Third World countries in the Uruguay Round would be met by time-derogations i.e. giving them more time to comply with the new rules and disciplines.

Dunkel reportedly put forward this view at an informal closed door meeting Friday of the UNCTAD Trade and Development Board where he discussed with members the Uruguay Round negotiations.

In several of the Uruguay Round negotiating groups, particularly in rule-making areas and in new themes where new rules and disciplines are being sought by the ICs, Third World countries have repeatedly said that time-derogations would not be enough and specific exceptions or provisions should be incorporated to take account of their situation and for incorporating a development dimension in the system.

In the various negotiating groups, the U.S., EEC and other leading ICs have said that they could only agree to a five to ten year time-derogation - a general derogation for the least developed countries and for other Third World countries on basis of individual situations - to enable these countries to comply with the proposed new rules and disciplines - whether in areas already covered by General Agreement or in new areas.

This view of the industrialised countries was repeated at the informal discussions friday by EC negotiator, Amb. Tran Van-Thinh, who said that while Third World countries could be given more time, they could not be given any exceptions to the rules.

In suggesting merely a time derogation, Dunkel clearly took a partisan view and supported the position of the major ICs, several of the Third World delegates present later said.

The Indian delegate, Amb. Inderjit Singh Chadha, who is the G77 spokesman on trade at the Board, disagreed with Dunkel and referred to the G77 statement before the Board thursday where it had said that specific elements should be incorporated in the agreements in each of the negotiating areas.

"Time derogations", Chadha reportedly said, were not adequate.

In other comments and exchanges, Tran also reportedly said that the U.S. and EEC should co-manage the negotiations so as to lead them to success.

If the Uruguay Round failed, he reportedly added, the U.S. and EEC could still live with it and survive, as also Japan and the Pacific Rim, but that the failure would have serious consequences for Third World countries. This was seen as an implicit warning to Third World countries that to ensure "success" they should agree to the demands of the U.S. and EEC on the new themes and disciplines.

The statement reportedly brought a retort from the Jamaica’s Amb. Lloyd Barnett who pointed out that it was the industrial countries that had pushed for and launched the negotiations and had been running it. It was a strange situation that those who pushed for and launched the negotiations, and who would suffer the least, had to do the most for the success of the Round.

Chadha for his part said that success and failures were subjective terms and recalled the story that after an UNCTAD meeting, a delegate of the G77 sent back a report to his capital that the conference was a failure and that the Third World had gained nothing, while the OECD delegate sent back a report that the conference was a success since "we gave away nothing".

Dunkel said he did not agree with some of the comments and that success or failure of the Round would affect everyone.

Earlier, Dunkel had told the delegates that the negotiations would enter their "crucial phase" from October 15, and that there would be intense negotiations not only in Geneva but in capitals, and that the evaluation from the viewpoint of Third World countries would take place early in November.

In effect challenging the slightly "upbeat view" of Dunkel, the G77 spokesman is reported to have said that multilateral trade negotiations were supposedly for trade liberalisation, but their experience was that it led to managed trade, selective safeguards and proliferation of grey area measures.

Chadha also reportedly complained that the results so far in the various markets access areas or in textiles and agriculture had not been satisfactory and any concessions "offered" were being eroded by demands for reciprocity.

Also, at a time when Third World countries were facing even more critical balance-of-payments problems there was an attack on their rights under GATT in facing the situation by demanding changes in Art XVIII: B.

The G77 spokesman also complained of the tendency in rulemaking to go against the interests of the Third World in gaining access to technology or provide rules adversely affecting investments for development.

The Soviet delegate reportedly asked Dunkel about the proposals for a Multilateral Trade Organisation (put forward by the EEC, and supported by Canada and some other ICs) and the view of the G15 (after their recent meeting in New York) opposing this and favouring the idea of an International Trade Organisation, on the lines of that proposed in 1948, being taken up and considered in universal fora in the UN system.

Dunkel, according to Third World participants, referred to his attending (along with UNCTAD Secretary-General) meetings of the ACC (UN Administrative Committee on Coordination) and that the GATT staff's salary, pension etc were according to the UN system, and that the GATT was part of the UN family.

Dunkel then reportedly said that at Punta del Este the GATT secretariat was entrusted with the responsibility of servicing the Uruguay Round negotiations. "The secretariat had employed a number of experts and their contracts would end next July. At the end of the negotiations why should those who serviced the negotiations not implement it?", Dunkel reportedly asked.

Observers present at the meeting said that this appeared to make the whole issue one of a mechanism for jobs.

On Dunkel's more substantive claims of GATT being a member of the UN family, implying thereby that the new organisation could be negotiated in GATT, they pointed out that GATT is not an UN specialised agency (unlike ILO, FAO, WHO, WIPO, etc., each of whom have their own charter including provisions about the secretariat).

The GATT has no agreement with the UN, similar to those of the specialised agencies each of which have agreements with the ECOSOC under Art. 63 of the UN charter and thus a charter relationship with the UN under Art. 57.

The ACC, they said, is an arrangement among the secretariats for administrative coordination. GATT staff conditions being in accord with UN staff rules, and Dunkel participating in meetings of the ACC, the observers said, perhaps flows out of the fact that formally Dunkel and the GATT staff are employed by the UN's Interim Committee for the International Trade Organisation (ICITO).