Dec 10, 1990

BRUSSELS TALKS TO ADJOURN, WILL RESUME MID-JANUARY.

BRUSSELS, DECEMBER 7 (BY CHAKRAVARTHI RAGHAVAN) The Uruguay Round's Brussels process came to end Thursday night and it is to be formally adjourned Friday to be resumed in Geneva, perhaps in mid-January.

GATT Director General Arthur Dunkel confirmed the collapse of the talks as he came in this morning and said the talks would be adjourned here to meet again in Geneva later.

As chairman of the official-level TNC, Arthur Dunkel is being asked to hold consultations about convening a meeting in Geneva.

Now, forwarded to Geneva will be the reports of the TNC Chairman Hector Gross Espiell, reports of the individual Ministers who were charged with individual sectoral consultations and the documents that had been received from Geneva.

But the various papers and texts which have been "floating around here" will have no other status.

While carrying on his consultations, Dunkel will also be guided in his work by the Chairman of the Ministerial TNC, Gross Espiell.

Most delegations, however, seem to feel that the Uruguay Round processes are now over and is difficult to see any real breakthrough to evolve a package of agreements.

The talks which had collapsed Wednesday night, had shown some signs of life for a while on Thursday, but these soon faded during the course of the day in the face of the basically unchanged EC position on agriculture (despite its nuancing it in various ways), and by early night it was clear that the Brussels process was dead.

Parallel talks had been resumed in all areas, as demanded by the EC, after it gave some hints of flexibility on Agriculture.

But late Thursday evening, when a green room on agriculture was convened, on the basis of a non-paper produced by the Swedish Chairman, Mats Hellstrom, after some persistent questions from other delegations, the EC made clout, that the new text was not acceptable to it, but that its own "responses" to Hellstrom and the TNC Chairman, in response to the various questions on agriculture posed in the drafty texts that came from Geneva, should be taken as the basis for discussions.

Argentina, Brazil, and the U.S. then said there was no basis for continuation of the agricultural talks, and all the participants also made clear that no further green rooms on agriculture should be summoned either by Hellstrom and he should report the deadlock to Gross Espiell.

Soon after this, Argentina and Brazil, with support of other Third World delegations and what seemed to be indirect support of the U.S., pulled out their delegates from the various drafting groups in other areas including services and TRIPs, and went away from the conference hall for the night.

Attempts in the TRIPs drafting group to continue the work, in the absence of the two leading Latin delegations, came to a halt when the U.S. and others called a recess on the ground they now needed "fresh instructions" from their delegations. The U.S. itself also called a halt in the services group.

Earlier in the day, in the light of the EC position on agriculture, the other delegations had been ready at a Thursday noon green room to call a halt to the Brussels process by asking for "suspension" of the talks here and their possible resumption later in Geneva.

At that time the EC appeared isolated and the blame for the talks seemed to rest squarely at its doors.

However, Thursday morning the EC had tried to reverse this trend by calling for resumption of parallel talks in all areas and hinting at some flexibility and movement on agriculture.

The talks were resumed in the various groups (on services, textiles, TRIPs and TRIMs, GATT rules) while the Swedish Agriculture Minister Mats Hellstrom conducted some bilateral consultations.

In a "global green room" chaired by TNC Chairman Hector Gross Espiell of Uruguay, the chairmen of various groups gave progress reports, claiming that progress was being made and agreements could be reached, and on this basis asked for continuance of the talks.

Third World delegates privately noted that four of the six ministers conducting the consultations came from countries heavily under EC influence, and gave out what seemed to them to be highly subjective assessments which had been orchestrated, and in that situation no one could say no.

Later Hellstrom produced a "non-paper" on agriculture to be the basis for further talks here and on this basis "green room" consultations on Agriculture was summoned for later in the evening.

In the paper, and in earlier discussions with him, the EC had reportedly agreed to start the cuts from bass year 1990 (rather then 1986 as it had previously thought), and also providing for a standstill of sorts in access and freeze in export subsidisation.

But at the Agriculture green room, after some questionings by all other delegations, it became clear that the EC had not moved basically and would not accept even the Hellstrom text as basis for further negotiations. The EC also wanted that its own responses to the questions posed to the Ministerial in the documents sent from Geneva should be the basis for negotiations.

The other delegations refused to accept this. and called a halt.

In the discussions, before a halot was called, the Indian Commerce Minister had also questioned the unsatisfactory provisions in the Hellstrom paper on special and differential treatment for the Third World countries.

The draft had provided essentially for a time derogation for them.

The Indian Minister said that for the Third World countries, whose dependence on agriculture was so large, it was neither economically necessary nor politically feasible to make reduction commitments.

Unless these issues, and border protection issues for countries facing BOP problems were tackled, it would be difficult for them.

The Chairman had reportedly assured that these concerns would be taken on board. Dunkel and TNC Chairman Gross Espiell told the informal Third World Group this morning that the talks can no longer continue. Gross Espiell asked Dunkel to hold consultations and convene the TNC - at Ministerial level.