Oct 29, 1986


GENEVA OCT. 27 (IFDA/CHAKRAVARTHI RAGHAVAN) -- The GATT Council Monday put off till its next meeting action on a Bulgarian request to join the general agreement, and the setting up of a working party to go into the request, the usual procedure in such cases.

Since 1960s, Bulgaria has been an observer to GATT, but has recently sought to join the GATT.

A large number of countries, both industrial and third world, appear to have spoken in support of the Bulgarian request for accession and/or setting up of a working party to go into the request, but the U.S. would appear to have objected strenuously.

The U.S. and EEC remarks were almost a case of "batten the hatches, the reds are coming", and appear to be aimed not merely at Bulgaria but an impending Soviet request, one third world delegate commented afterwards.

Hungary, Argentina, Uruguay, Nicaragua, Peru, Cuba, India, Brazil, Mexico, Poland, Czechoslovakia, Yugoslavia, Finland (on behalf of the Nordics), Nigeria and Rumania reportedly spoke at the meeting, either supporting the accession and/or the setting up of a working party.

The U.S. delegate, Amb. Samuels, is reported to have opposed the move, arguing that non-market economies were not compatible with GATT membership, and the issue whether Bulgaria as a centrally planned economy could undertake real GATT obligations would have to be considered.

The EEC delegate, Tran Van Thinh, is reported to have said that GATT could no longer have "an open door policy", but must view such applications from the viewpoint not only of benefit to the applicant, but on the effect on the GATT system itself.

Bulgaria, the U.S. delegate is reported to have insisted, should first demonstrate about the tangible reforms in its Foreign Trade Policy. The issue of a working party should be considered only after Bulgaria submitted its memorandum on its foreign trade regime.

Earlier, in presenting the request, the Bulgarian Director-General in the Ministry of Foreign Trade, Atanas Paparizov had said that such a memorandum was under preparation and would be submitted in the spring of 1987.

Paparizov had underlined that Bulgaria now ranked 33 in world exports, and foreign trade was important for its national economy.

Bulgaria, Paparizov added, was "at an intermediary level of development, similar to that of a number of developing countries", both in respect of GDP and structure of its exports to the OECD countries, and this intermediary level should be recognised in negotiating its accession terms into GATT.

The EEC delegate questioned Bulgaria's claim to the same status as their world countries. But the EEC could consider Bulgaria's application, "on the basis that it is a non-developing country".

An effort by the Council Chairman, Amb. Kazuo Chiba of Japan (who chaired the meeting, since chairman, Kun Park of Korea, has demitted the Office on assignment to New York), to put off a decision on setting up a working until the Bulgarian Submission of a memorandum on trade policy, was however opposed by a number of countries, who underlined that this was not the usual procedure.

The Council put off a decision until its next meeting.

Among other issues that came up before the Council Monday, Morocco, which has competed its negotiations for accession to GATT, was given time till December 31 to complete remaining bilateral negotiations and sign the instrument of accessing.

The European Communities, on another issue, complained over the terms of the U.S.-Japan accord on semi-conductors, and sought consultations with the two parties.

The EEC noted that not all the terms of the agreement between the two countries, and particularly its effect on prices in other markets as well as access to japanese markets for non-U.S. exports, was clear.

"There was very little transparency on the part of the U.S. and EEC with regard to GATT on this issue", the EEC representative is reported to have complained.

The U.S. and Japan both claimed that the agreement would in fact enhance access to Japanese markets for all exporters and prevent dumping of japanese products in their markets, as well as in the United States.

The assurance did not appear to have removed the concerns of others, and a number of countries, both industrial and third world appear to have spoken in support of the EEC.

These included Sweden for the Nordics, Canada, Korea, Australia, brazil, Switzerland, Hong Kong, Singapore and Argentina.

On another complaint, the U.S. sought the appointment of a panel to go into its dispute with Japan over quantitative restrictions (QRS) imposed by Japan on some of the agricultural products from the U.S.

Japan would appear to have first suggested that the issue, like other issues in agriculture, was best dealt with in the multilateral trade negotiations on goods, and within the terms of its mandate on agriculture.

In such negotiations, the Japanese delegate is reported to have said, the QRS by Japan would be on the negotiating table, just as the restrictions maintained by the U.S. under the waiver obtained by it from GATT in respect of agricultural imports.

Several of the products against whose imports into Japan the U.S. was complaining, the Japanese delegate is reported to have added, were under restraint in the U.S. by virtue of the waiver.

However, the U.S. request for a panel was supported by among others Canada, Australia, Argentina, Uruguay, Brazil, the EEC and New Zealand.

Japan ultimately agreed to the request. The terms of reference of the panel and its membership would be decided by consultations.