TRADE NEWS BULLETIN Volume II Number 13 Friday, January 22, 1993 __________________________________________________ GATT News Summary __________________________________________________ CLINTON'S AGRICULTURE STANCE UNCLEAR EC Trade Commissioner Leon Brittan and GATT chief Arthur Dunkel plan to meet with new U.S. Trade Representative Mickey Kantor next week as part of an effort to complete world trade talks before the U.S. fast-track negotiating mandate runs out in March. The new U.S. trade strategy is still largely undefined, but Belgian Foreign Minister Willy Claes said yesterday he did not think concluding the Uruguay Round of GATT would be any easier under the Clinton Administration. Kantor has indicated he will re-examine the EC-U.S. farm trade accord reached last November, and new U.S. Agriculture Secretary Mike Espy said in his Senate confirmation hearing that he plans "to be more unreasonable than our EC counterparts" as he promised to pursue a good deal for U.S. farmers. Espy also called the U.S. Export Enhancement Program (EEP) "a necessary and effective tool in maintaining competitiveness of our exports in the face of heavy subsidization by other countries." Britain's National Farmers Union and outgoing German Farm Minister Ignaz Kiechle are stressing the need to conclude the GATT negotiations, but France continues to oppose an agreement it feels is inconsistent with the EC's Common Agricultural Policy. Demonstrations on GATT and agriculture continue. Last Friday, fifty French farmers broke into and occupied the New Zealand embassy in Paris to protest New Zealand's appeal to GATT for increased mutton export quotas to the EC. "The dramatic situation of sheep producers is the result of the effort to promote global free trade at the lowest price," said a farm union official. Japanese Agriculture Minister Masami Tanabu has expressed willingness to meet with Kantor to discuss Japan's rice policy. Japan currently bans rice imports on national food security grounds, and has resisted a Dunkel proposal to replace the ban with tariffs, which would be fazed out by 1999. In a public debate, Professor Masaru Morishima of Tokyo University said Dunkel's tariffication plan "could be the end of Japanese agriculture." Professor Yujiro Hayami of Aoyama Gakuin University predicted lower losses and said tariffication through GATT would be preferable to bilateral negotiations with the U.S. that could lead to a complete drop on rice import barriers. "Dunkel's plan means purgatory for Japanese farmers. But bilateral talks with the U.S would mean hell," he said. Source: David Dodwell, "Brittan Blitz on GATT Talks," FINANCIAL TIMES, January 21, 1993; "Clinton Will Not Make GATT Easier, Says Belgium," REUTER, January 21, 1993; "USDA's Espy Skeptical of GATT Farm Pact Benefits," REUTER, January 21, 1993; "No Changes in U.S. Farm Program Now - USDA's Espy," REUTER, January 21, 1993; Peter Blackburn, "German, French Farm Ministers Differ Over GATT," REUTER, January 22, 1993; "French Farm Protesters Occupy New Zealand Embassy," REUTER, January 22, 1993; "Japan Farm Minister Plans to Meet Kantor on Rice," REUTER, January 21, 1993; "Japan Rice Tariffs Seen Hurting Farmers - Professor," REUTER, January 21, 1993; Bernard Simon, __________________________________________________ CANADA REAFFIRMS REJECTION OF TARIFFS Top Canadian trade, agriculture and industry officials yesterday denied press reports that Canada was considering the tariffication of import controls on supply-managed agricultural goods. Agriculture Minister Pierre Blais said, "Canada remains committed to supply management as an essential element of Canada's agricultural policy." Tariffication is viewed as a major threat to the country's supply management program. The Canadian Chicken Marketing Agency and the Dairy Farmers of Canada issued statements expressing outrage at the press reports. Source: "Canada Considers Customs Tariffs," FINANCIAL TIMES; "Canada's Position on Agriculture Remains Firm in GATT Talks," NEWS RELEASE, Government of Canada, no.12, January 21, 1993; "Statement by Annual Meeting of Dairy Farmers of Canada to Rt. Honorable Brian Mulroney, Prime Minister," January 21, 1993; "Chicken Producers Request Meeting With Prime Minister," PRESS RELEASE, Canadian Chicken Marketing Agency, January 21, 1993. __________________________________________________ LATIN AMERICAN NATIONS FIGHT EC BANANA REGIME Colombia and Costa Rica have said they will object to any GATT deal that upholds EC limits on Latin American banana imports. Meanwhile, Ecuador is assembling lawyers to appeal the restrictions to the EC, the GATT and the international court at the Hague. Latin American banana producing nations are planning a summit on the issue February 10. The EC last month adopted a 2.2 million ton quota on Latin American bananas, with a tariff structure that increases dramatically when the quota is exceeded. The arrangement honors market access guarantees promised to traditional suppliers in Africa, the Caribbean, the Pacific (ACP countries) under the Lome Convention. EC imports of Latin American bananas, which are produced more cheaply and on larger-scale plantations than ACP bananas, amounted to 2.9 million tons in 1992. Source: "Colombia and Costa Rica Protest EC Banana Issue," REUTER, January 19, 1993; "Ecuador Assembles Lawyers to Fight EC Banana Issue," REUTER January 21, 1993; "Banana Exporters Say EC Restrictions Will Cost 174,000 jobs," UNITED PRESS, January 21, 1993. __________________________________________________ NAFTA News Summary __________________________________________________ TRINATIONAL ANALYSIS TEAM BLASTS NAFTA Social and environmental organizations from Mexico, Canada and the U.S. met in Mexico City January 15 -16 to share their analyses of the North American Free Trade Agreement (NAFTA) and to develop common strategies. The groups said they shared a common suffering from "the negative effects of neo-liberal policies on the well-being of our peoples and our nations' sovereignty." A tri-national declaration specifically criticized the Energy, Agriculture, Intellectual Property Rights and Foreign Investment and Financial Services sections of the NAFTA text. All participants agreed on the importance of developing a trade agreement that asserts a social agenda to ensure higher living standards for citizens of all three countries. Source: FINAL DECLARATION, trinational NAFTA analysis network, January 17, 1993. __________________________________________________ OTHER TRADE NEWS __________________________________________________ AFRICAN BLOC AIMS FOR FTA BY YEAR 2,000 Leaders of the 18-member Preferential Trade Area (PTA) for Eastern and Southern Africa declared their intention to slash internal tariffs 60 percent by October and achieve a common market by the end of the decade. At a summit meeting this week, the leaders agreed that non-tariff barriers within the bloc should be eliminated immediately. Some analysts are skeptical the target dates can be met, citing civil wars in three member states and the long process undergone by the more stable EC. The PTA is made up of Angola, Burundi, Comores, Djibouti, Ethiopia, Kenya, Lesotho, Malawi, Mauritius, Mozambique, Rwanda, Somalia, Sudan, Swaziland, Tanzania, Uganda, Zambia and Zimbabwe. Zaire and Namibia applied for membership. Of all trade currently carried out by member countries, 4.6 percent is within the grouping. Source: Anton Ferriera, "African Leaders Say Progress on Common Market Slow," REUTER; January 21, 1993, "African Trade Bloc Urges Scrapping of Tariffs," January 21, 1993, REUTER. __________________________________________________ RESOURCES "The 1990's: The Decade of Global Competition - Without Restrictive Business Practices?" by Philippe Brisick. An examination of how restrictive business practices by large corporations fit in with the idea of competition embodied in trade liberalization measures. Brisick is chief of the Restrictive Business Practices Unit at the UN Conference on Trade and Development. An "Occasional Paper" published by the International Coalition for Development Action (ICDA), 115 Rue Stevin, 1040 Brussels, BELGIUM; tel: 32/2/230.04.30; fax:/32/2/230.03.48; E-mail: ICDA@geo2.org __________________________________________________ Produced by: Hannah Holm The Institute for Agriculture and Trade Policy (IATP) 1313 Fifth Street SE, Suite #303 Minneapolis, MN 55414-1546 USA Telephone:(612)379-5980 Fax:(612)379-5982 E-Mail:kmander@igc.org _________________________________________________________