Dec 4, 1990

TNC MINISTERIAL BEGINS AMIDST UNCERTAINTY OVER OUTCOME.

BRUSSELS, DECEMBER 3 (BY CHAKRAVARTHI RAGHAVAN)ó Extreme uncertainty and a general lowering of expectations is the prevailing mood here as the Ministerial meeting of the Uruguay Round Trade Negotiations Committee began Monday at the Brussels Exhibition Centre outside the City.

The morning meetings began with a ceremonial opening by the King of Belgium and welcome speeches from the Foreign Trade Minister of Belgium and another from the President of the EEC commission, Jacques Delors, and the Chairman of the TNC, Uruguay's Foreign Minister Gross Espiell.

As the meeting began here, some thousands of farmers from Europe, and scores from Japan and South Korea and other places began gathering for a mass demonstration decrying agricultural trade reforms pushed by the U.S.

About 1500 delegates from the 107 countries participating in the round, some 1000 media representatives and probably an equal number of private sector lobbyists from big business are gathered here for what is described as the final meeting of the Uruguay Round, though already some qualifying words are being attached.

At a press conference Sunday, for example, GATT Director General Arthur Dunkel spoke of the will of all participants to make the Brussels meeting "the concluding meeting" of the Uruguay Round at "political level". This last appeared to be the qualifying words, thus leaving the door open for continued work at official level in Geneva in the New Year.

The U.S. Trade Representative, Carla Hills spoke of the need for a "big package" to be concluded here at Brussels in order to win congressional support. And other U.S. remarks - that of the accompanying Huge Congressional delegation and the separate businessmen's delegation - also all made the same point.

However, the U.S. Agricultural Secretary, Clayton Yeutter did seem to feel that some of the Punta del Este objectives "may be out of reach".

Asked at his press conference about this, Dunkel said that in any negotiations "you put the maximum on the table and then you come to terms". He also spoke of the negotiators coming together, recognising "political realities" and finding the "right balance between different interests".

Dunkel also hoped that when the Ministers-meet, the optimistic assessments of what could be achieved and the consequences of failure would make governments come to an agreement.

If the Brussels meeting failed, he added, the world would not come to an end the next day or month, but there would be a drift and uncertainties and lack of business confidence, a gradual erosion of confidence, and "very soon after that governments would come back to the table".

In separate press conferences the U.S. Congressional and Business delegations appeared to flex their muscles in putting pressures on other countries to yield to demands and come to quick agreements and compromises.

Max Baucus, Chairman of the U.S. Senate subcommittee on trade said that the fast-track authority expiring on March 1 will not be renewed.

Under the U.S. law, the administration has negotiating authority till 1993. The fast-track authority has some deadlines beginning March 1 when the administration has to notify Congress of its intention to reach agreements and send the bills for implementing legislation to Congress before May 30. Congress can only vote yes or no but not amend these bills.

However, President Bush can notify Congress and extend the fast-track authority for two more years, but this can be negatived if either house by resolution votes against it.

Resolutions have been tabled in the U.S. Senate to change the rules to take away the authority even earlier.

Baucus spoke also of need for agreements to bring "major benefits" to U.S. industry to enable Congress to override sentiments against GATT.

Remarks of other Congressmen, Don Paese of House Ways and Means Committee and Sam Gibbons, Chairman of its Subcommittee on trade also made clear that to gain Congressional support for ratification the final package would need to have strong rules on subsidies and anti-dumping and Congress would in any event want to retain its S-301 unilateral retaliation rights.

Many of the voices in the Third World and Europe calling for concessions to the U.S. on TRIPs and Services, etc., are on the premise that with strong multilateral agreements, the U.S. unilateralism and its retaliatory power would be ended.

The Congressional remarks left little doubt that it would not be so.

The Business groups who pressed for concessions from Europe on Agriculture and in other areas from other countries would not say in what areas the U.S. would give.

John Reed, chairman of the Citicorp also expressed concern over slow progress in services - this despite the fact that it is the U.S. which has now thrown a spanner in the works by refusing to accept an unconditional MFN clause in the services agreement and in addition, wants to exempt whole service sectors of its service industries from the framework.

At his press conference Dunkel also spoke of the GATT trying to lay down clear rules of the game to provide security and confidence for its "clients" and "customers". While he never specifically identified them, his other remarks left little doubt that for GATT its "clients" are not its member-states or the people, but the business and trading community and by extension the 20 percent of it in the world, the transnational corporations, who control 80 percent of international trade in goods and services.

Dunkel also made references to the way the issues were handled and settled at Montreal for the mid-term review, with governments slowly agreeing on texts, on condition that nothing was agreed until everything was agreed. This he said had enabled them to reach agreements in a number of areas leaving difficult-ones till end when they were solved at official level consultations a few months later.

He appeared to prefer the same approach here, though noting that it would not be possible to extend the Round.

This, with his earlier remarks about this being the closing meeting at "political level", implied that he would prefer to finish agreements in many easier ones, and get political "decisions" from Ministers and wrap up the details here or in Geneva later on hard issues.

However, it was not clear whether others including the Cairns Group were ready to fall in line with this strategy or trap.

In private meetings, the U.S. appears to be trying to gang up the Third World countries against the EC over agriculture and this appeared to have hardened the EC stands.

One Latin American source said that the impression after a U.S. meeting with Latins was that the U.S. was encouraging the Latins or its Cairns Group members to precipitate a crisis on agriculture in the beginning itself but it was not clear whether, this would happen.

There is continued talk too of the majors entering into some deal towards the end and attempting a mini-package of results, with broad guidelines for continuing negotiations in other areas under another garb perhaps through an MTO.

But several Third World delegations think that this would not be possible at this time, particularly if the mini-package would have to include accords such as on TRIPs.

The Indian Commerce Minister, Dr. Subramanium Swamy, who has been in office just a week or so under the new government in Delhi made clear that India would be unable to compromise and yield to the U.S. and EEC over TRIPs.

Dunkel was asked at his press conference about his talk of the "global nature" of the negotiations and whether it would not be better to leave issues like intellectual property, pesticides, etc., to be dealth with by UN agencies of competence like WIPO, FAO, WHO etc?

Dunkel denied that the GATT Secretariat was having "any imperial ambitions" vis-à-vis other international organisations. It had been asked to service the negotiations on services, intellectual property, etc. How the results are to be implemented was an open matter. But he saw no conflict between GATT, WIPO, FAO, WHO, etc. Monday's business at the meeting is confined to a ceremonial opening in the morning and the TNC meeting in the afternoon for organising the negotiations, but Dunkel hoped the conference would not get bogged down over procedures.

Some 7-8 separate negotiating groups, each under a Minister, are envisaged to tackle the outstanding issues, which, a reading of the draft report shows, to embrace almost all areas.

Dunkel insisted that the meetings would end this "week-end", but added that the week-end would be long. Despite Dunkelís views, the prevailing impression amongst a range of Third World delegations is that at best the meeting could end with some kind of outcome, similar to the Montreal mid-term accords - Ministers giving broad guidelines, leaving it to their officials to work out details in Geneva.

Many Third World delegations, however, say that this time, unlike at Montreal, the stakes are so high that the final decisions too would need Ministerial involvement.