Oct 31, 1990

CAN GATT’S "EXERCISE IN CRISIS MANAGEMENT" SAVE THE ROUND?.

GENEVA, OCTOBER 29 (BY CHAKRAVARTHI RAGHAVAN)— As GATT Director-General Arthur Dunkel undertook Monday what his officials frankly described as "exercise in crisis management", there were increasing doubts whether the Uruguay Round negotiations, could at all be salvaged by these belated efforts.

Third World sources said that though the public focus was on the agriculture negotiations and the EC's internal quarrels and inability to table any "offers", the deadlock in the negotiating process embraced all areas and it was difficult to see how an acceptable package could be evolved and put into legal form before the Brussels meeting set for December 3.

Dunkel has scheduled an informal meeting, at level of heads of delegations, of the Trade Negotiations Committee (TNC) on Friday November 2 when he plans to make a detailed assessment of all parts of the round, and another meeting on November 6 "to draw conclusions from the review".

The expectation of Dunkel and GATT officials is that over the intervening week-end, the expected presence of ministers from several of the participating countries could be used "to ensure ministerial support for the negotiating process".

Agriculture Ministers from the 13 countries who are members of the Cairns Group have scheduled a meeting in Geneva on November 4.

The U.S. Trade Representative Mrs Carla Hills, the EC Trade Commissioner Frans Andriessen, Canadian Trade Minister John Crosbie (Canada is a member of the Cairns Group) and the Italian Foreign Trade Minister Renato Ruggiero (Italy now heads the EC Council of Ministers) are all expected to be in Geneva at the same time for bilateral and plurilateral consultations.

A GATT spokesman, who briefed newsmen on the plans for the informal TNC meetings, said that apart from agriculture, there were "lots of problems" in all the negotiating groups.

He said no formal structure for ministerial participation in the TNC had been planned, but that it was expected that between November 2 and 6, Ministers would be able to meet with their own delegations bilaterally and plurilaterally, and take advantage of their presence to ensure ministerial support for the negotiating process.

The spokesman referred in this connection to the Cairns Group meetings and the scheduled meeting of the G15.

The G15 Ministerial meeting is scheduled for November 7, preceded by two days of talks among their senior officials and negotiators.

It is not very clear whether their Ministers will be around for the week-end, though there is some overlapping between the Cairns Group and the G15 - Malaysia, Indonesia, Argentina and Brazil being members of both.

The meeting of the GATT affairs Ministers of the G15 and other Third World countries was set up (after the meeting of their Foreign Ministers in New York on September 28 at the UN General Assembly) for a coordinated assessment and contribution from their countries, in the context of the evaluation of the results (in trade in goods) which the Group of Negotiations on Goods.

The Punta del Este declaration has mandated the GNG to undertake, "from the perspective of the effective application of differential and more favourable treatment to Third World countries", an evaluation of the results attained in all areas in terms of the objectives and general principles governing the negotiations.

The GATT now making a reference to the G15 and looking to them for support to salvage the round is perhaps one of the ironies.

For, when the Venezuelan Foreign Minister who had chaired the New York meeting had issued a statement summing-up the discussions, expressing well known positions of these countries in the negotiating areas and insisting on the idea of an International Trade Organisation being taken up and discussed in universal fora, and this had received media attention, GATT officials, and those of leading ICs, were privately critical of the G15 Foreign Ministers' and their "interference" in trade negotiations.

But when it became clear that the EC would not be able to table its "offers" in agriculture and that even if tabled it would not be acceptable to others, and that the negotiations in all other areas were also deadlocked and near collapse, Dunkel in private conversations would appear to have begun sounding out leading G15 countries about using their meeting to save the negotiations.

Last week, when it was clear that the EC was hopelessly deadlocked on what it could "offer" by way of reform in agriculture, Dunkel had planned to convene a formal meeting of the TNC. But this was opposed by the U.S., which wanted the EEC to be given more time.

But after the weekend failure of the Rome summit of the EEC to resolve the issue, and the postponement of the scheduled meeting on October 30 of the EC Trade and Agriculture Ministers to resolve their disputes, Dunkel would appear to have revived the idea of a formal TNC but this did not find favour with the U.S. and EEC.

Third World diplomats as well as several from European countries were speaking Monday of the exercise being how to avert a breakdown and "salvage" something out of the four-year multilateral trade negotiations due to end at Brussels in week of December 3.

The key words, from the point of view of the Europeans and other ICs appear to be "scaling down", ambitions (in agriculture, textiles, etc.) and aiming for "modest results".

Third World sources noted however that this was coupled with talk of "package" (including in services and other new areas where the "give" is to be from the Third World) and ensuring its acceptance by all through a "single protocol" at Brussels, for institutionalising the GATT and continue the negotiations in all areas, through a GATT work programme.

The EEC, in private conversations, has reportedly been saying that while the Brussels meeting could not be postponed nor the negotiations prolonged, the meeting could agree on whatever had been negotiated and ready, and institutional arrangements created for continuing the negotiations, with the GATT Ministers at their meeting after two years reviewing the situation and taking decisions.

The U.S. has been opposed to prolongation of the Round, pointing to the expiry in March of its "fast track" authority to submit legislation to Congress and getting it voted as a package.