Dec 4, 1987


GENEVA DECEMBER 2 (IFDA) -- Third world participants in the General Debate at the 40th. Session of the GATT Contracting Parties have underscored the need to pay attention to their needs in areas of traditional concern in GATT.

The session is due to end on Friday, with some of the controversial issues and disputes expected to come up during the consideration of the report of the GATT Council on the year’s activities.

Speaking Tuesday evening, Jamaica’s Antonhy Hill said the Uruguay round should provide benefits to all participants, and care should be taken to avoid "exclusive emphasis" on issues of concern primarily to special interests or placing "short-sighted emphasis" on trade liberalisation limited only to sectors of interest to the industrialised countries.

"In constructing the international trade system for the 21st. Century we must avoid creating difficulties for developing countries to play their full part in contributing to the renewed dynamism of the world economy".

The positive elements in the GATT should be fostered – expansion of membership to encompass the large majority of third world countries, the strengthening of the rule of consensus and consensus, if not accommodation, to the development, finance and trade interests of majority of membership in application of GATT rules and principles.

Dr. Suhadi Mangkusuwondo of Indonesia, speaking for the Asian group of countries, expressed deep concern over possible adverse effects on the trading system of recent crisis in international financial markets, and particularly the prospect of major industrialised countries embarking on import restrictions due to the weakening of their domestic demand.

"If major industrialised countries fail to agree on concerted efforts in dealing with the crisis in the financial markets, we are afraid that another world recession will emerge and that the first victims of such an unfortunate event would be the developing countries, many of which are still struggling to cope with their severe debt problems and to overcome their serious shortage of resources for their development".

The Indonesian delegate said that much more progress was needed than had been achieved in the initial phase, to enable negotiations to go forward. More concrete negotiating proposals should be put forward to tackle the fundamental problems of the trading system.

Of special interest to the Asian countries, he said, were the negotiations in tropical products, agriculture, safeguards, and market access issues like non-tariff measures and tariffs, particularly tariff escalation.

Tropical products were of utmost importance to third world countries, and "failure to reach agreement on this will reduce considerably the confidence of developing countries in the Uruguay round, and also in the GATT as an institution to safeguard the interests of all Contracting Parties, developed and developing alike".

The problems in agriculture were largely the result of polices of major industrialised countries in accumulating surpluses trough excessive subsidies, and the main responsibility to solve the problems lay with the countries.

Sri Lanka’s P. Nagaratnam said that the international economic order had weakened in recent years under strains of sluggish growth, growing resistance to structural change, and failure to adjust to international indebtedness.

Solutions to these problems lay in pursuit of national and international policies supportive of growth, development, trade and employment, particularly by countries with a greater weight in the world economy.

Also, trade policies should be directed towards adherence to open markets and acceptance of multilateral disciplines.

Serious difficulties continued to confront the international trade of third world countries because de depressed levels of commodity prices, deterioration in their terms of trade, and declining share in world exports.

"The Uruguay round can only have meaning for developing countries if substantial export gains do materialise through greater liberalisation of trade in export sectors of interest to them. The achievement of negotiating mandates in sectors such as tropical products, agriculture, natural resource-based products and textiles and clothing are of particular relevance to them".

Also, early results in tropical products would be particularly importance for the large number of commodity-dependent countries like Sri Lanka.

Hong Kong’s Hamish McLeod said no credibility should be attached to the idea that "GATT is outdated, ineffective and irrelevant".

"Such assessments", he said, "have no basis in fact. Indeed in the same breath some of the same critics ask that the GATT take on new subjects, surely a clear if unintended compliment".

The negotiations in the next three years, he added, should achieve a balanced outcome to address concerns of all, and provide right sort of support and stimulus to the world economy.

The Punta del Este commitment to preserve the basic principles of GATT and strengthening the system "cannot be interpreted as allowing any weakening of the most favoured nation principle in the direction of selectivity", Mcleod said.

While they might not have received as much attention as the "high profile" subjects of agriculture might and services might, issues like safeguards and textiles were no less critical to the viability of a balanced outcome at the end of the round.

There could be no "first and second class subjects", and safeguards and textiles would not drop off the agenda. Nor should it be expected that the agenda of the Punta del Este mandate in terms of negotiating objectives could be modified.

And while the mid-term review should be designed to stimulate progress towards achievement of negotiating objectives, "it should not be regarded as an opportunity to review or modify the objectives themselves".

In a reference to the efforts of the big trading blocks to set up "a steering group" of select Ministers to guide GATT and the negotiations, Mcleash added: "small and exclusive contact groups, core groups, steering groups, whatever their composition or wherever they meet, and useful as they may be, must at the end of the day carry with tem all the interested Contracting Parties and participants".

Yugoslavia’s Ranko Radulovic said his country faced difficulties in its exports – concentrated in so-called "sensitive" sectors like textiles, iron and steel products, tools and agriculture – primarily because of restrictions imposed outside GATT rules.

In the Uruguay round MTNS, Radulovic said, no one could expect to resolve his problems, only, and results within the envisaged time-frame could be achieved only if interests of all participants were taken into account. This could not be done unless the principle of special and differential treatment to third world countries was applied to all areas of negotiations.

The Yugoslav delegate also complained that third world countries facing BOP difficulties were being asked to adopt time-limited solutions, while the industrial countries had been protecting for decades their sectors like textiles and clothing that had lost comparative advantage.

Nigeria’s E.A. Azikiwe said the strict, and more transparent, observance of the standstill and rollback commitment was crucial to progress in the Uruguay round negotiations.

Agriculture and tropical products were now rightfully receiving priority, and Nigeria supported measures for reduction or elimination of subsidies and guaranteeing reasonable and competitive access. The proposals in agriculture should be flexible enough to allow for modifications to take account of the developmental interests of the third world.

As for new issues, negotiations should proceed "cautiously and in a non-ambitious pattern". There should be a balance between liberalisation and legitimate aspirations of third world countries towards industrialisation and acquisition of technology.

The services negotiations should allow for a cautious programme and timing to allow third world countries to tap their available resources and expertise that would enable them to set up or review necessary regulatory organs at national level. Without this they could neither grapple with intricacies of negotiations nor benefit from any agreements that would finally reached.

Egypt’s Dr. Nabil Elaraby said without a stable monetary and foreign exchange environment and a solution to third world indebtedness, there could be no effective trading system.

Areas of concern to Egypt, as for other third world countries, included agriculture, tropical products, textiles, and safeguards.

While the Punta del Este declaration was a carefully balanced package of compromises reconciling different views, the first year of negotiations showed a clear tendency of the part of some participants to go beyond the carefully drafted negotiation mandate. It was a matter for concern that some countries appeared to be still influenced by their "pre-Punta del Este perceptions".

As for early harvest or early results, the declaration specifically recognised for urgent treatment safeguards and tropical products.

China’s Qian Jiadong said the October stock market crash had demonstrated how vulnerable the world economy was. On china’s efforts to resume its GATT membership, a subject now being examined by a GATT working party, the Chinese delegate said this would not only serve the interests of China but also that of other countries and the world economy as a whole.

Lyle Williams of Trinidad and Tobago was afraid that countries like his would find themselves at the end of the Uruguay round "saddled with decisions of far-reaching future effect and significance with which they will be unable to live and which may very well threaten their fundamental national interests".

Williams referred in this connection to the service negotiations where, because of lack of expertise of countries like his, the negotiations were among unequal partners. The mood and approach in the negotiations so far, he complained, had been solely influenced by considerations of self-interest and the philosophy of "each man for himself and the devil take the hindmost".

Though in the final analysis national laws and sovereignty would prevail, his country did not consider this to be conducive to "negotiating in good faith".

And while the move of countries like Canada to provide technical assistance to enable better participation, this would be of no avail so long as the industrialised countries did not honour the mandate of the Punta del Este declaration "to work towards the mutual interests of both developed and developing alike".