TRADE NEWS BULLETIN Volume 2 Number 75 Thursday, April 29, 1993 ________________________________________________________ NAFTA News Summary ________________________________________________________ WAYS AND MEANS COMMITTEE FORMS NAFTA SUPPORT GROUP The House Ways and Means Committee has formed a liaison group to work with the White House to foster support for the North American Free Trade Agreement (NAFTA). The group, headed by Representative Robert Matsui (D-California), will meet with Trade Representative Mickey Kantor and other officials to strategize on how to win Congressional approval of NAFTA. Ways and Means chair Dan Rostenkowski (D-Illinois) said, "We should not let false fears prevent us from pursuing an accord that is both fair and balanced." Source: "U.S. House NAFTA Support Group Formed," REUTER, April 27, 1993. ________________________________________________________ ENVIRONMENTAL COMPANIES EAGER FOR MEXICAN MARKET Many U.S. and Mexican environmental cleanup companies are preparing for expanded business as Mexico takes steps to improve its environment. NAFTA critics say the trade pact will encourage American and Canadian companies to relocate to Mexico to take advantage of lax environmental law enforcement. But NAFTA supporters say the agreement will lead to tougher laws and enforcement, which will benefit the environmental industry. "The stricter the enforcement, the better for the industry," said David Robinson, an American environmental consultant based in Mexico. "There are two sides to the (clean-up) question ... On one hand it will cost industry and government a lot of money, but on the other side a whole new industry is being created." Robinson estimates the environmental industry could grow by $100 million per year to become a $7 to $10 billion industry by the year 2000 if environmental laws are enforced. According to a study by the U.S. Commerce Department, the market for water pollution equipment alone grew nearly 400 percent from 1991 to 1992 . Currently only four percent of Mexico's waste water is treated. Mexican companies are only able to meet 50 percent of the demand for water treatment equipment. The other half is met by imported equipment, primarily from the United States. Mexican President Carlos Salinas de Gortari has asked polluting companies in Mexico City to reduce their emissions by 70 percent by mid-1994 . Salinas has also included $1 billion in revolving credits for companies that acquire cleaner technology. A U.S.-Mexico border clean-up program calls for $1 billion in spending from 1992 to 1994 . Last week, during a conference in Mexico City on environmental business opportunities, nearly 80 U.S. and Mexican companies met to discuss market potential. Source: Lawrence Kootnikoff, "Mexico-Cleanup," AP, April 23, 1993. ________________________________________________________ GATT News Summary ________________________________________________________ VIETNAM DETERMINED TO JOIN GATT GATT Director General Arthur Dunkel will visit Vietnam May 17 to 22 to discuss how the country should proceed with plans to seek membership in the world trade body. Vietnam is eager to join GATT, and has made adjustments to please GATT members and satisfy global trade regulations. "Becoming a member of GATT is urgent," said Nguyen Dinh Luong, Vietnam's trade minister. "We are gradually shifting from a centrally planned economy towards a free market." Vietnam's primary exports are crude oil and rice. It is preparing to become a large importer of capital equipment for projects aimed at improving roads, ports, airports and telecommunications. Meanwhile, the Vietnam America Trade and Investment Consulting Company (VATICO) opened this week, becoming the first American business to operate officially in Vietnam since 1975. The embargo blocking Americans from doing business in Vietnam was eased in December. U.S. businesses can now open offices and sign -- but not execute -- commercial contracts. VATICO and other companies are counting on the U.S. lifting the economic embargo altogether. But President Bill Clinton recently announced the U.S. would not renew trade with Vietnam until questions concerning missing soldiers are resolved. "We're just not there yet," Clinton said. Sources: "Vietnam's GATT Move," NEW YORK TIMES, April 28, 1993; John Rogers, "Vietnam Keen to Join GATT, Dunkel to Visit," REUTER, April 27, 1993; "Clinton Says U.S. Not Ready Yet to Resume Trade With Vietnam," JOURNAL OF COMMERCE, April 26, 1993. ________________________________________________________ EC TAKES FIRST STEP TOWARD GATT DISPUTE PANEL OVER STEEL A GATT committee agreed yesterday to begin a preliminary investigation into the European Community's complaint concerning punitive U.S. duties on steel exports. The Community requested the action after bilateral talks between the two sides failed. The GATT Committee on Subsidies and Countervailing Measures will have 30 days to resolve the dispute before the EC can formally request a GATT panel. "The possibility of a GATT panel is a very real one," said Sir Leon Brittan, EC trade commissioner. "And there are other possibilities which I do not want to go into because until we have completed consultations with the industry it would not be in the interests of those who work in the industry to canvass all the options." The U.S. imposed duties in January in retaliation for what it considers unfair foreign subsidies. The move affects seven EC nations, as well as Japan, Brazil and the Nordic countries. "It is very sensitive politically and important economically," said one EC delegate. Sources: Stephanie Nebehay, "EC Asks for Conciliation on U.S. Steel Tariffs," REUTER, April 28, 1993; "GATT Panel Possible on EC-U.S. Steel Row," REUTER, April 28, 1993. ________________________________________________________ Resources: "GATT's New World Order: A Threat to Food Safety," SAFE FOOD NEWS, Winter 1993. For a copy or membership information, contact: Safe Food News, Food & Water Inc., R.R. 1, Box 30, Old Schoolhouse Common, Marshfield, VT 05658. ________________________________________________________ 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 ________________________________________________________