TRADE NEWS BULLETIN Volume II Number 51 Thursday, March 18, 1993 _____________________________________________________________ NAFTA News Summary _____________________________________________________________ KANTOR CONTINUES TRYING TO SELL NAFTA TO SKEPTICS In testimony before the House Agriculture Committee yesterday, U.S. Trade Representative Mickey Kantor claimed the North American Free Trade Agreement would increase sales of U.S. agriculture products. But lawmakers from farm states questioned whether the agreement could prevent Mexico and Canada from selling to the United States sugar, peanuts, citrus and other products that they had imported from other countries. The pact would replace non-tariff barriers to agriculture with tariffs, most of which would be phased out within nine years. While U.S. and Mexican officials were beginning negotiations on environmental, labor and import surge provisions, members of Congress again voiced concerns about NAFTA's impact on these issues. "I think our main export to Mexico is likely to be jobs, not products," said Senator Donald Riegle (D-Michigan). Senator Howard Metzenbaum (D-Ohio) echoed Riegle's remarks. In an opinion- editorial in today's WASHINGTON POST, Senator Max Baucus (D- Montana) claims the only way to prevent environmental degradation under NAFTA is through a North American Commission on the Environment (NACE). "A strong NACE is a fair price to ask for the benefits that NAFTA will bestow on Mexico," Baucus writes. In Mexico City, U.S. Commerce Secretary Ron Brown tried to reassure Mexican officials that the Clinton Administration is still committed to NAFTA. Brown said Clinton wants the pact passed and implemented by January 1, 1994, and that the United States would not seek new commitments from Mexico beyond the side accords. However, Brown conceded the "ratification process might be a difficult one ... There are some who are attempting to graft other agendas on top of the free trade agreement whether or not that agreement might be threatened in the process." Source: Robert Greene, "Trade Talks," AP, March 18, 1993; Peter Behr, "Fears of Job Exodus Emerge as Chief Hurdle for Free Trade Pact," WASHINGTON POST, March 18, 1993; Max Baucus, "Freer Trade, A Greener Continent," WASHINGTON POST, March 18, 1993; Vicki Allen, "Negotiators Hold Talks on NAFTA Labor, Environmental Safeguards," REUTER, March 17, 1993; "Mexican Leaders Assured of NAFTA Support -- Brown," REUTER, March 17, 1993; Laurence Iliff, "U.S. Commerce Secretary Says No New Conditions on NAFTA," UPI, March 17, 1993. _____________________________________________________________ GATT News Summary _____________________________________________________________ DELORS, CLINTON TO MEET TODAY European Commission President Jacques Delors and U.S. President Bill Clinton are expected to discuss GATT and disputes over aircraft industry subsidies and government contracts during talks today in Washington, D.C. The meeting was originally planned as a "get- acquainted meeting," but new trade rows and statements yesterday by EC Trade Commissioner Leon Brittan indicate the talks will be more substantive. Brittan said the Clinton Administration is sending mixed messages on trade. "It is confusing and unhelpful to speak the language of the open trade system with one voice and to encourage quite serious and damaging pinpricks which shake the world's confidence," he said. Brittan said Delors will urge Clinton to resist protectionist pressures. Regarding the aircraft dispute, Brittan said U.S. subsidies of the civilian aircraft industry are "very large and may possibly exceed levels agreed last year." USTR Kantor told U.S. lawmakers the fate of the Uruguay Round depends on the U.S. and EC reaching agreement. He said he thought the negotiations could be completed to the advantage of the United States but that it will take some time. "I do not believe that we were as close to completion as some reported in early January," Kantor said. Sources: Stephen Nisbet, "Delors to Urge Clinton to Resist Protectionism," REUTER, March 17, 1993; Lyndsay Griffiths, "Trade Tops Bill as Delors, Clinton Meet for First Time," REUTER, March 18, 1993; Carl Hartman, "US-GATT," AP, March 17, 1993. _____________________________________________________________ TAIWAN ON TRACK FOR GATT, CHINA WANTS IN FIRST A senior GATT official said he thought Taiwan was on track for admission to the General Agreement on Tariffs and Trade. After a five-day visit to the island, Charles Carlisle, deputy director general of GATT, said Taiwan's agriculture "is slightly more protected and subsidized, and this may raise certain problems in the accession process, but in general terms, I do not think there will be any huge problems that cannot be resolved." Carlisle reassured Taiwanese officials that a dispute with the U.S. on protecting intellectual property rights would not affect Taiwan's status. However, Carlisle implied that China, which is also trying to enter GATT, could delay Taiwan's application. "China wants to enter first, and many contracting parties in GATT also feel this way," he said. "But many parties also do not, and no consensus has been reached." In Geneva, China concluded three days of talks with GATT officials on its application to the world trade body. Delegates said little progress had been made. China faced questioning on tariffs, foreign exchange regulations and customs areas. Sources: "GATT Official Encouraging on Taiwan GATT Application," UPI, March 17, 1993; "Slow Progress Reported at China GATT Talks," REUTER, March 17, 1993. _____________________________________________________________ Resources: Two briefs from the University of California, San Diego Center for U.S.-Mexican Studies: "Human Rights and Indigenous Workers: The Mixtecs in Mexico and the United States" (Current Issue Brief 4, 42 pages) by Carole Nagengast, Rodolfo Stavenhagen, and Michael Kearney; and "The Uncertain Connection: Free Trade and Mexico-U.S. Migration" (Current Issue Brief 5, Center for U.S.-Mexican Studies, 1993, 39 pages) by Wayne A. Cornelius and Philip L. Martin, addresses the question of how NAFTA will affect Mexican rural migration to the United States, arguing that while migrations may increase initially, they will decrease in the long-term. Both publications are available from the Center for U.S.-Mexican Studies, University of California, San Diego, 9500 Gilman Drive, La Jolla, CA 92093-0510. Telephone: (619) 534-1160. _____________________________________________________________ Produced by: Kai Mander 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 _____________________________________________________________