7:53 AM Mar 10, 1994


Geneva 10 Mar (Chakravarthi Raghavan) -- While still working towards a 1 January 1995 target date for entry into force, GATT sources say the Uruguay Round agreements, including its institutional framework of the World Trade Organization, may come into force some months later.

The delay is primarily to suit the Japanese Parliamentary calendar. The Japanese Parliamentary session where this could be brought up won't start until February and, in the current state of the domestic politics of the Hosakawa government, it might be difficult to convene a special session in 1993 for this purpose only.

Everyone, including Japan, is anxious to bring the WTO into being as early as possible, particularly because it would bring the United States and its unilateralism under control. But Japan is too big a trading partner for setting an entry date that it would not be able to meet for becoming a original Member.

Switzerland is another country facing problems -- since a referendum could easily be called by signatures and by recent outcomes, the Swiss public could turn it down, just as they agreements with the EC. But if they do it would be a Swiss problem.

Meanwhile, an implementation conference at Ministerial level is envisaged to meet in the 'autumn of 1994'.

Though it is stated to be one in terms of the Part III of the Punta del Este Declaration, one of its tasks has in fact been settled by the provisions of the World Trade Organization.

The Punta del Este Declaration had envisaged that "When the results of the Multilateral Trade Negotiations in all areas have been established, Ministers meeting on the occasion of a Special Session of CONTRACTING PARTIES shall decide regarding the international implementation of the respective results".

This was put in at Punta del Este, because of the compromise of a two-track approach to the negotiations in goods and in services, leaving the final determination of any services agreement and how and where it should be located for implementation -- as a part of GATT or separately. Subsequently, at the 1989 mid-term review, the location or implementation of the TRIPs agreement was also put into this category.

Since then, the Final Act specifically provides for the establishment of the WTO, with separate bodies under it for GATT, GATS and TRIPs.

The Punta del Este mandate itself did not provide for the creation of any new institutional framework or an organization. But the somewhat vague mandate about the Functioning of the GATT system (FOGS) had been stretched to include the negotiations on and establishment of a WTO.

So it is not clear what an implementation conference would do and whether ministers, after having gone to Marrakesh for signing the Final Act, would again come for another meeting in autumn (Vienna is being talked about as the location for this) to decide on or agree on a date for entry into force?

At an informal heads of delegations meeting Wednesday, participants have reportedly agreed that the Final Act provisions (where the entry date, now in square brackets, is envisaged as 'not later than 1 July 1995) may be reworded to suggest "1 January 1995 date or as soon as possible thereafter".

Meanwhile, GATT sources said that as of Wednesday, 20 of the 117 GATT contracting parties, participants in the Round, are yet to file their schedules. This is apart from the 26 least developed countries who have a year's time (after entry into force) of filing their schedules.

With the formal accession, under Art XXVI:5 (c), of the United Arab Republic on 8 March, GATT has now 117 contracting parties.

At the heads of delegations meeting, GATT Director-General Peter Sutherland again warned that in the case of schedules of countries filed after 11 March, the secretariat would be unable to guarantee that these could be reviewed, verified and annexed to the Final Act for the Marrakesh meeting.

Only those whose schedules are attached to the Final Act to be signed at Marrakesh can become original members of the World Trade Organization.

There is a general disinclination to give more time. But Participants are not very clear as to what would happen to those whose schedules cannot be verified and filed.

On the trade and environment issue, while consultations are still going on over the work programme on trade and environment, it now seems more likely that the work programme to be approved would not go into any details beyond those spelt out in the decision adopted by the TNC on 15 December.

It is clear that the Americans and Europeans want something to be decided in order to satisfy their environment lobbies.

While the US and European Union would like to create formally a Committee on Trade and Environment in the WTO, with a vague mandate that could be expanded later, it is still running into opposition, with a number including India insisting that before any such body is formally set up, there should be a clear agreement on its mandate which is yet to be worked out through the work programme.

Some of the industrial countries who earlier had been in favour of a 'shopping list' of items for the work programme appear now to be more cautious.

As items for study like 'internalization' of externalised costs, 'production process methods' (PPMs), 'eco-dumping' etc have been raised by some of the NGOs, and the need to be more specific about use of economic instruments in the trade arena and in terms of the WTO trade mandate and "compatible with an open, non-discriminatory multilateral trading system", even the US clearly wants to look into them more carefully before being specific.

If environment is accepted, as it is generally, as one of the endowments within the national jurisdiction of countries and enabling policy choices, except where there are transborder spill-over, invoking trade instruments on environmental grounds need greater specificity and definitions. Otherwise it could be a protectionist instrument, and not a one way street for the North to protect itself against the South.

Some groups advancing these ideas have been looking at them in terms of using these to gain international control over resources in national jurisdictions (tropical forests, biological diversity etc) or to preserve 'competitivity' of domestic production of products that nationally have to undertake more stringent process conditions, the possibility of its becoming an instrument against exports of industrialized countries are only now becoming more apparent to the North.

Some industrial country delegates, who have been in favour of bringing in some aspects of environment into the WTO, privately say that some of the recent advocacy by some Norther NGOs may have actually done more harm than benefit.