TRADE NEWS BULLETIN Volume II Number 49 Tuesday, March 16, 1993 _________________________________________________ NAFTA News Summary _________________________________________________ EPA CHIEF SAYS SALINAS COMMITTED TO ENVIRONMENT Carol Browner, administrator of the U.S. Environmental Protection Agency, praised Mexican President Carlos Salinas de Gortari for his commitment to the environment and said she believed supplementary agreements to the North American Free Trade Agreement (NAFTA) can be reached quickly. "I was very pleased to learn the laws in Mexico and the commitment Mexico has made to implementing those laws," Browner said after meeting with Salinas and other officials in Mexico City. Most environmental problems in Mexico are the result of poor enforcement of existing policies. Browner will conclude her two-day trip to Mexico today with a tour of the free-trade zone along the U.S.-Mexico border, which has suffered extensive environmental damage. Negotiations on environment and labor side accords between the U.S., Canada and Mexico begin tomorrow. One U.S. official said Mexico has committed only $450 million to clean up its border region, an amount most officials estimate will be insufficient to solve problems. Isaac Cohen, head of the U.N. Economic Commission for Latin America's Washington office, said, "At a time when budget cuts are under way, it is hard to imagine extra U.S. funding to clean up the border." In other news, the attorney-general of Texas will release tomorrow a position paper on NAFTA's impact on the state's environmental, health and safety laws. The Texas-Mexico Border Task Force found: "NAFTA may preclude state initiatives to better protect citizens and the environment ... NAFTA may hamper initiatives to better protect the health and safety of citizens and the environment ... NAFTA precludes states and other interested parties from participating in NAFTA's dispute resolution proceedings ... NAFTA will disproportionately impact border states." Sources: "NAFTA Partners in Talks on Jobs and Environment," REUTER, March 16, 1993; "U.S. Environment Agency Chief Optimistic About NAFTA," REUTER, March 15, 1993; Andrew Cawthorne, "NAFTA on Target Despite Need for Side Accords, Says EPA Chief," UPI, March 15, 1993. _________________________________________________ GATT News Summary _________________________________________________ U.S. CANCELS MEETING WITH EC ON UTILITIES DISPUTE U.S. Trade Representative Mickey Kantor unexpectedly canceled next Monday's meeting with the EC on public utilities contracts, a move that could lead the U.S. to ban EC firms from bidding on U.S. public contracts and further hurt the chances of concluding the Uruguay Round of GATT. The row began January 1 when EC rules came into effect which the U.S. says discriminate against U.S. firms bidding for water, energy, transport and telecommunications contracts. The U.S. has since threatened to levy sanctions on $40 to $50 million of EC goods and services. As a pre-condition to their meeting, the U.S. demanded the EC abandon article 29 of its Utility Directive which gives a three percent price preference for Community firms, but the EC was unwilling to make this concession before the meetings. One EC official said of the request, "It's not the way to negotiate ... it's like walking into the negotiating room naked." European Commission President Jacques Delors will meet with U.S. President Bill Clinton on Thursday. Sources: Peter Blackburn, "EC Sees Tough U.S. Trade Stance Crystallizing," REUTER, March 15, 1993; Lionel Barber, "Risk Grows of EC-U.S. Tit-For-Tat Trade War," FINANCIAL TIMES, March 15, 1993; "U.S. Dumps EC Talks, Sanctions Closer," REUTER, March 12, 1993. _________________________________________________ CITIZENS GATHER TO OPPOSE DUNKEL DRAFT A group of 250 scientists, academics, media, industry representatives, farmers, consumers, students and non-governmental organizations (NGOs) from industrialized and developing countries gathered in New Delhi, India to assess the Dunkel Draft Text (DDT) of the Uruguay Round. The International Convention on People's Approach to GATT Negotiations, which was held February 18-20, passed a resolution to reject the present form of the DDT, saying it ignores the basic needs and aspirations of people around the world. The group strongly urged NGOs across the globe to unite and campaign against the draft which they consider a threat to human rights and the environment. Source: "People's Resolution on Uruguay Round," NATIONAL WORKING GROUP ON PATENT LAWS, February 18-20, 1993. _________________________________________________ Other Trade News _________________________________________________ FREE TRADE NEGOTIATIONS RESUME AMONG G-3 Representatives from "Group of Three" (G-3) countries Colombia, Venezuela and Mexico met March 9-10 to discuss progress and objectives of a free trade zone among the three countries. The agenda included transportation, telecommunications, finance, agriculture, intellectual property, technical standards and foreign investment. During their last meeting February 11-12, the G-3 countries and Central American nations signed the "Declaration of Caracas," under which they pledged to establish the beginnings of a free trade zone by June 30, 1993. Another meeting is planned for the end of this month to discuss tariff reduction and rules of origin. The Colombian Association of Plastic Industries recently expressed strong opposition to the pact, arguing that Mexican and Venezuelan plastic industries enjoy unfair advantages by refusing to import petrochemical inputs. Sources: Hannah Holm, "G-3 Negotiations Resume," EAI NEWS, March 12, 1993; "Caracas Meeting Makes Progress, Rough Spots Remain," EAI NEWS, February 19, 1993. _________________________________________________ Resources: BEYOND THE TWIN DEFICITS: A TRADE STRATEGY FOR THE 1990'S, a book by Robert A. Blecker of American University and the Economic Policy Institute (EPI), challenges the conventional view that the federal government budget deficit and other failures of macroeconomic policy are solely reponsible for American trade problems. Paperback available for $17.95 from EPI, 1730 Rhode Island Avenue NW, Washington, D.C. 20006. Tel: (202 )775-8810. _________________________________________________ Produced by: Kai Mander and Gigi Boivin 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.apc.org _________________________________________________