9:04 AM Mar 23, 1995

AMBASSADORS OKAY RUGGIERO ELECTION, AND SOME DEALS

Geneva 23 Mar (Chakravarthi Raghavan) -- Heads of delegations of members of the World Trade Organization (WTO) agreed Thursday to the formal election Friday at the WTO General Council of the EU nominee Renato Ruggiero as the next Director-General.

The informal HOD meeting also agreed on some of the decisions which have been part of the 'deal' that has led to the election of the 64-year old Italian.

They agreed that Ruggiero should be named to a four-year term, and that the next Director-General will be a non-European.

They also agreed to the creation of one more post of a Deputy Director-General for the WTO and recommended that the necessary measures should be taken for this by the WTO's Budget Committee and the new Director-General.

Though it was not formally brought up and decided, there is a general understanding that the Korean losing candidate, Kim Chul-Su is to be named for that job (and in accord with current practices it would be for a three year term).

Under the WTO/GATT rules for this decided in 1986, the Director-General is to appoint his deputies, but after consultations with the Contracting Parties.

The three existing Deputy Directors-General, Anwar Hoda from India, Warren Lavorel from the United States and Jesus Seade from Mexico were appointed to their posts by Sutherland, after he had looked through various nominations and proposals, and interviewed them before choosing them.

But while Ruggiero, who will take over on 1 May, will go through the motions of this procedure of 'consultations', at Washington DC, he had already announced at a Press Conference his decision to appoint KIM to a fourth deputy's post.

The meeting was advised that there was a view (in the consultations leading to the selection of Ruggiero) that in the future, for filling up the posts of the Deputy Directors-General when they fall vacant, regional interests and particularly of the African region should be taken into account.

But all these (the intended KIM appointment an African and regional claims) did not go unchallenged, participants coming out of the informal meeting said.

New Zealand Ambassador was described as having given a scathing criticism of these regional and other considerations and as saying that "management structures should not be used for fulfilling unfulfilled ambitions".

The New Zealand view was supported by Switzerland and the EU also, with the EU Ambassador that there were good brains and men in all the regions of the world, and they should get hold of the best possible people for the jobs without regional considerations.

A meeting of the General Council of the WTO has been summoned for Friday morning to formally put through the election of Ruggiero and other related issues.

General Council meetings, even urgent ones, need under the rules (just approved in January) ten days notice, but the rules requirement are to be set aside by the WTO/GATT formula of acting pragmatically and agreeing by consensus to disregard the rules.

At a news briefing, after the HOD meeting, Kesavapani, relieved to have this exercise behind him, said the WTO members would be taking steps, in the selection of a future D.G., to avoid a repetition of "this traumatic experience" which had been deeply troubling to the delegations.

Asked about the nature of the problem and the "traumatic experience", Kesavapani said it was a mixture of regional effects (in the contest) and the decisions being taken outside.

The regional nature of the contest "got us locked" and it took two regions (EU and US) to get together to break the deadlock, before "we were able to convince the third and move to a consensus".

As they came out of the informal meeting, delayed by need for repeated consultations, Thursday many WTO/GATT diplomats were clearly uneasy and unhappy at the way the WTO was setting out.

Several Asian and other diplomats expressed their concerns (noting that only New Zealand and Switzerland had voiced it inside the informal meeting), and blamed themselves.

As one Asian diplomat, who has been at the GATT, through the Uruguay Round and now in the WTO, put it, "several Asian countries, caught up in the slogan of regional support for regional candidate, blindly backed as an Asian candidate, the Korean nominee, instead of putting up a good candidate themselves. Then, when a deal was being cut, and Korea was a party behind their back and did the deal and announced it, before advising the other Asians. In the process the system has been damaged, and so are the Asians and their wide interests."

The majors don't really need an organization, and the United States, he said was a real winner, the diplomat said, adding that a US official, when told in private about their wrong backing for Salinas and being left without options, as having said: "don't worry; we have won: of the five top management jobs, four owe the job to us..."

Earlier in the day, Ruggiero who had come to Geneva went to the Singapore mission to call on Kesavapani, and the Egyptian Ambassador Mounir Zahran who Chairs the GATT (1947) Council.

It was not clear how the meeting was set up, but it has clearly been done after it became known that Ruggiero was coming.

Some of the delegations said that it had been set up after Ruggiero's varying views, and remarks in Washington, had become known and gave rise to concerns among the general WTO members, and more so among developing countries.

Emerging from the meeting, Ruggiero, among other things, spoke of his goal of promoting global free trade and his intention to ensure that the interests of the developing countries and of the least developed among them were protected and helped.

He also spoke of the need "to promote free trade and strengthen the multilateral system" which he said would be the two pillars that would guide his actions.

The WTO, he said, faced an immense challenge in implementing the Uruguay Round agreements -- challenge on "how to ensure globalization of the economy promotes more growth and reduces disequilibrium" and also "how to fully integrate the developing countries into the international trading system, because we all have to learn that this is a small world and we have to build a consensus on the main objectives in front of us".

Ruggiero said he would take only a four year term (part of the horse-trading and deals involved in his election), adding "I am nearly 65, and I don't want to end my life while I am still working".

The Italian also tried to set at rest Third World fears that he would try to introduce into the WTO debates the question of links between trade and labour, as urged by the United States, and said, when asked whether he would like to see the issue raised in the WTO "The agenda for the WTO has been set. There has been no agreement on (including that)."