KIM WITHDRAWS, RUGGIERO TO BE WTO HEAD

10:13 AM Mar 21, 1995

KIM WITHDRAWS, RUGGIERO TO BE WTO HEAD
Geneva 21 Mar (Chakravarthi Raghavan) -- The former Italian Trade Minister and the nominee of the European Union, Renato Ruggiero, is to be named as the next Director-General of the World Trade Organization this evening at a meeting of the Heads of Delegations of the WTO/GATT.

Singapore's Ambassador Kesavapani, who, as Chairman of the WTO General Council is in charge of this process of selecting a WTO head, has convened the meeting of the heads of delegations where the Kim withdrawal is to be announced officially and choice of Ruggiero is to be approved by the WTO/GATT membership which has also to agree to establish the fourth post of Dy. D.G. to accommodate Kim.

There are now three Deputy DGs: Anwar Hoda from India, Warren Lavorel from the United States and Jesus Seade from Mexico (all named to the posts when Peter Sutherland was named GATT Director-General in July 1993).

Ruggiero's consensus election, for a single term, brings to an end nearly a year-long tussle -- ever since Sutherland, the GATT Director-General who took the job to complete the Uruguay Round negotiations, made it known after Marrakesh that he was not interested in the WTO top post (which at that time he could have had for the asking).

The Ruggiero consensus election has been made possible by the announcement of the withdrawal of the rival candidacy of the South Korean KIM Chul-Su, who is to be made a deputy Director-General in a fourth post that is to be created by the World Trade Organization.

As part of a complicated 'deal' over the last few days involving the US, the European Union and Asian countries that had been backing KIM, Ruggiero will be elected to one-term and the European Union is expected to announce its position that the next head of the WTO would be a non-European. This assurance of the EU not staking a permanent claim to the WTO post, and about the choice of a non-European to that job after Ruggiero, is however something that the EU has been giving to key Asian and Latin American delegations for quite several months now, even when former Mexican President Salinas was also in the race, and can't be presented as part of the deal the US had worked out to endorse Ruggiero and get Kim to withdraw.

US Trade Representative, Mickey Kantor is due to make an announcement in Washington about the US support to Ruggiero at midday local time -- around the same time as the informal heads of delegations meeting here.

Japan, not to be outdone, is also reported to be planning to announce (in Tokyo and here) its own support to, and endorsement of Ruggiero.

Kantor had been quoted (after the Salinas withdrawal) several times as saying that the US was not 'impressed' with the qualifications of, either of the two candidates (Ruggiero and Kim). Both Kantor and other administration officials also termed Ruggiero as 'protectionist'.

But the US, after the Salinas withdrawal (following the Mexican crisis that damaged his credibility), has found itself with few options. Several of the other names it 'floated' did not fly or the candidates proposed did not agree.

A US team led by Kantor's deputy, Jack Lang that visited Geneva found other WTO members did not seem ready to back the US in calling for a fresh process or looking for a new candidate.

With the General Council Chairman Amb. Kesavapani 'holding their feet to the fire' -- by the deadlines for completing the process, the US has been forced to agree to the Ruggiero choice.

With 'face' -- often painted by western media as an Asian obsession -- clearly also an American and western obsession when losing, over the last fortnight or so US officials have been trying to find a "face-saving" formula for Kantor's acceptance of Ruggiero.

As part of the formula, Ruggiero has gone to Washington to meet Kantor, and enable Kantor to suggest that he had received assurances about Ruggiero's "free trade" credentials.

The United States is known to have tried to 'upstage' the multilateral processes in Geneva by first making the announcement, not only about its backing now for Ruggiero, but the other parts of the 'deal' and adding its own 'spin' including what Ruggiero would do to "implement" the Marrakesh agreement on agriculture.

Many delegations here, both from the major developing countries, as well as some of the European Union members themselves, while welcoming the end to this election "tussle" that has distracted their attention from the substantive work at the WTO, are however a little concerned about the way the election is being played out and portrayed.

While many of Kim's backers, for some days, had been saying that when the US is forced to acquiesce, Kim would be withdrawing, privately say that by agreeing to take a deputy's post in return for withdrawing his candidacy, the point Kim and South Korea had sought to make in entering the race originally may have been diluted and devalued.

They are also waiting to see what kind of statement will come out of Washington from Kantor, and what Ruggiero would be saying there.

Any attempt by the US and/or Ruggiero, to overstress one of the WTO accords over another, or a DG role in any implementation, is likely to produce here some adverse reactions at the WTO.

Even some US officials are said to be aware of the implications.

Several Third World delegations have noted that the implementation of the WTO and its annexed agreements was the responsibility of the countries, and collectively of the WTO membership.

The WTO agreement, one of them noted, has not given this responsibility to the head of the WTO, but to the membership of the WTO and the Director-General of the WTO is only the head of the secretariat who cannot place any one of the agreements on a superior scale or give assurances to any contracting party on the implementation.

With many of the WTO agreements worded ambiguously, and with few of those who negotiated them whether for the majors or others) around, other long-time observers of the trade scene fear that the WTO processes would be a secretariat-driven non-transparent process --- where the 'negotiating history' would be available wherever it suited the interests of the US or EU, and the terms of the agreement would be interpreted and explained when it can be used against the South countries.

In this matter, Ruggiero will be judged by the extent to which he is able to control the secretariat and its processes -- and demonstrate his 'independence' of the United States and the European Union.