7:01 AM Mar 16, 1995

SUTHERLAND TO STAY ON TILL END APRIL

Geneva 15 March (Chakravarthi Raghavan) -- Peter Sutherland, the GATT Director-General who brokered the conclusion of the Uruguay Round negotiations leading to the establishment of the World Trade Organization, and staying on as the first Director-General of the WTO, has been requested and agreed to stay on for another short-term, till end of April.

Former Italian Trade Minister Renato Ruggiero (waiting in Rome with his bags packed to come to Geneva) seemed nearer his goal and moving into the WTO seat on 1 May.

But this race has been full of some many surprises and stumbles by competitors that, despite odds favouring him, any betting on this could become a baring-leeson derivative.

The request to Sutherland, and his acceptance, came less than a half-day before he was due to lay down his charge.

An informal heads of delegations meeting that took these decisions Wednesday evening.

It was coupled with the assessment conveyed to the meeting by Amb. Kesavapani of Singapore, the WTO General Council Chairman who has been conducting the consultations, that there was now a "pronounced trend in favour of the leading candidate", that a number of other delegates had enough flexibility to contribute to an emerging consensus, but that an additional time-period of ten days should be provided for completion of the consultations and a consensus decision.

Referring to what he called the 'post-March 15 situation and the stewardship of the WTO between now and the time the WTO D.G. is selected and assumes office', Kesavapani noted that as decided in December, Sutherland "has exercised the functions of the Director-General of the GATT/WTO until 15 March". That decision was based on the hope that the selection process of a D.G. would be completed by that date and the new D.G. could assume office.. But this has not been possible.

"To avoid a vacuum in the leadership of the WTO during the interim period, Mr Peter sutherland has been requested to stay until 30 April to facilitate a smooth transition until his successor can assume office.... Mr. Sutherland has agreed to this arrangement".

In a separate statement issued by the WTO secretariat, Sutherland said that at the request of the full membership of the WTO, he had agreed to a "final extension of my term of office as Director-General of the WTO" until 30 April 1995 and "I have done so solely because of my personal concern that at such a crucial, formative time in the life of the new WTO, the Secretariat's management and the Organization's public credibility should not suffer."

In plain English, all this attempted to suggest (without actually setting a new deadline) that a consensus could be achieved in ten days and that the EU's candidate, former Italian Trade Minister, Renato Ruggiero could be elected by consensus as head of the WTO and would take over on 1 May.

Before a consensus decision is reached though, the US has to remove its objection to Ruggiero, never formal, but widely publicised by administration officials over the past several weeks.

After backing former Mexican President Carlos Salinas for over six months only to see that candidacy crumble, and trying to block the EU nominee Ruggiero, the US left without any option of a new process and a new candidate, appeared to be edging towards acquiescing in or accepting his election.

The US sought the ten days time -- which the EU and Kesavapani portrayed as the limit, but which US Ambassador Bruce Gardner suggested was only a "target" for the US to be able to take a decision. The EU's chief WTO delegate, Jean-Pierre Leng told the media "Ruggiero is ready to take over tomorrow" and the reason for the 10-day delay should be sought from the Americans.

However, it appeared that Washington and Brussels were discussing on this, to reach understanding on this and a few other mechanisms which have not been spelt out. Other key players are also looking to see how to ensure that this does not result in a US-EU concordat over the WTO.

As part of the consensus process and US supporting Ruggiero, or afterwards, the Korean candidate, Kim Chul-Su and his Asian backers, have to be persuaded to clear the way for a consensus. Perhaps this too may need some understandings.

It will involve Ruggiero, 65, being a one-term WTO head (a two or three year term is being talked about) and some understanding that his successor will come outside Europe -- and some Asians hope, it could be an understanding to find the next head from Asia or atleast a developing country.

Much of the consultations this week (after last week's new head count confined to Ruggiero and Kim showed many of Salinas's supporters backing Ruggiero, but KIM holding his own, though with some his supporters reportedly telling Kesavapani that they could however accept any consensus favouring Ruggiero) -- was about the interim arrangements. On Monday, the US had indicated it would need more time on the WTO head and as a result it was clear that this decision would have to be put off for some more days.

The decision to request Sutherland to continue, and the period, was settled after some protracted negotiations on Tuesday night and Wednesday morning -- with the EU trying to limit this (for fear with time Ruggiero's chances could be derailed, and Sutherland continued for a two-year term). Even after the EU and the others agreed on the extension of Sutherland's term Wednesday afternoon, there was further haggling over the language of the 'request' to Sutherland to continue.

The EU had suggested that he be requested to continue "no later than 30 April" -- a language implying a Sutherland desire to cling on and the WTO ending it finally. Sutherland baulked at this, and it took more haggling before the formulation requesting him "to stay until 30 April" was achieved.

If the EU, as seen by others, had sought to cut Sutherland to size, ironically the final outcome proved otherwise. Kesavapani's statement spoke of the need "to avoid a vacuum in the leadership of the WTO during the interim period".

The WTO agreement provides no real role for the WTO head. If Sutherland got such high encomiums, it was because he came into the GATT job (at the request of the US and EU at a propitious time when the two wanted to conclude the negotiations) and Sutherland was able to take a high profile to bang publicly the two to bring this about, and had sufficient sense of fairness to champion the cause of the developing countries who otherwise might have come out of the negotiations with even less than they have now.

The WTO agreement does not enable a secretariat-driven forum, and any and every decision is reserved to its membership and the 'leadership' has to be that of the major trading nations of the North and the South.

In November 1990, when he was the trade minister and Italy holding the six-monthly Presidency of the European Community, in a press interview (that he sought to explain away later, as he is now doing about his last December views in Washington on the US) Ruggiero had suggested that the negotiations should result in the establishment of an international trade organization and said this "would help mask the failure to reach agreements and conclude the negotiations, and enable the negotiations (on the Uruguay Round agenda) to be continued beyond the Brussels meeting.

Ruggiero may discover that not only is the WTO is a different animal from the ITO/MTO he suggested 'to mask the failure of the Uruguay Round', but that the WTO which has come after its successful conclusion, is not even "the most powerful rule-based third pillar of the Bretton Woods architecture" it was portrayed to be in the runup and immediately after Marrakesh, and that in the WTO D.G.'s job he may have to constantly prove he is neither a tool of the EU or US or both.