TRADE NEWS BULLETIN Volume 2 Number 85 Friday, May 14, 1993 ------------------------------------------------------------------------ A number of TRADE NEWS subscribers have requested that we expand our services to include two additional features. First, many readers asked that we produce a short "week in review" every Friday to remind them of the week's most important developments. Second, there have been requests for short abstracts of the most important studies and reports that come across our desk each week. We are changing the format of our Friday edition to meet these requests. Friday's bulletin will now include a "week in review" to recap developments plus a list of reports by our new staff editor Chirag Mehta. ------------------------------------------------------------------------ WEEK IN REVIEW ------------------------------------------------------------------------ NAFTA News Summary ------------------------------------------------------------------------ NAFTA OPPOSITION MOUNTING IN UNITED STATES Opposition to the North American Free Trade Agreement (NAFTA) is growing in the United States, according to a recent Gallop Poll. The survey, conducted in March for CNN and USA TODAY, found 63 percent of Americans opposed to the trade pact, up from 57 percent last September. Only 31 percent of Americans said they support the deal, down from 33 percent earlier. Many senior and freshman lawmakers have also joined opposition to fight against NAFTA. On Thursday, Representative Collin Peterson (D-Minnesota) announced the formation of an anti-NAFTA caucus comprised of 24 Democratic and Republican representatives. Peterson said the caucus will work to defeat NAFTA and create a "North American Fair Trade Agreement" in its place. During his opening statement before Congress, Peterson described NAFTA as "fundamentally flawed," saying, "no side agreements will change that." The caucus plans to defeat NAFTA by using national and local media to combat the "disinformation" campaign launched by multi- national corporations and to communicate to other congressional members through hearings to demand that NAFTA be rewritten. "We should have a free trade agreement with Mexico -- but it must keep American workers and our environment safe," Peterson said. "NAFTA fails to do this." Peterson reiterated comments made a week earlier by Budget Director Leon Panetta, saying, "If Congress voted on NAFTA today, I don't think it would pass." In attempt to save NAFTA from Congressional defeat, President Clinton announced yesterday that he will push for new powers to enforce labor and environmental side accords. Clinton said countries should have the power to impose tough trade sanctions in the case of "persistent and unjustifiable" patterns of nonenforcement of national laws. Under the new proposal, efforts would be made to resolve the complaint first through consultations. If these failed, the complaint would then be sent to an arbitration panel. After two of the three nations have agree that a violation has occured, the complaining country would be able to impose sanctions under its own trade laws. Negotiators from the United States, Canada and Mexico will meet to draft side accords in Ottawa May 19-22. Sources: Peter Behr, "New Powers Sought for Trade Pact," WASHINGTON POST, May 14, 1993; "Congressional Anti-NAFTA Caucus: Statement of Principle," May 13, 1993; "Final Touches to NAFTA Side Deals Expected in June," REUTER, May 7, 1993; "Free Trade With Mexico," NATIONAL JOURNAL, May 1, 1993. ------------------------------------------------------------------------ CANADIAN PARLIAMENT WANTS TREATY CHANGES, BRAZIL INTERESTED IN JOINING A Canadian parliamentary committee studying the NAFTA text for ratification proposed changes to the copyright section of the trade pact. The committee suggested eliminating copyright clauses altogether to permit consultation with the cultural industry. Changes are not allowed to the free trade pact, signed last December by leaders from the United States, Canada and Mexico. If copyright concerns can be worked through, Canada would be the first country to ratify the trade pact. Meanwhile, Brazil said it is interested in joining NAFTA if its other trade partners, specifically the European Community and Asia, approve. Brazil and other South American and Central American countries are expected to join NAFTA under the "accession clause," which permits new members provided they accept all conditions of the trade deal. Sources: Risa Maeda, "Brazil May be Interested in Joining NAFTA," REUTER, May 13, 1993; "Canada Amends Bill That Will Implement NAFTA," REUTER, May 13, 1993. ------------------------------------------------------------------------ GATT News Summary ------------------------------------------------------------------------ FAST-TRACK LIKELY FOR GATT, FRANCE ANNOUNCES TOUGH TRADE STANCE The U.S. House Ways and Means Committee approved the extension of the fast-track negotiating authority needed to conclude the Uruguay Round of General Agreements on Tariffs and Trade (GATT). If the full House and Senate also accept President Clinton's request to extend the fast-track, he would have until December 15 to sign the final draft of the Uruguay Round. Congress would then have 120 days, until April 15, 1994, to vote "yes" or "no" on the trade pact. The Clinton Administration said it feels confident that the current round will be completed by the April deadline and announced this week that both the United States and European Community will work to achieve "tangible progress" in the GATT negotiations by July's summit of the Group of Seven (G-7) leading industrialized countries. "We've directed our negotiators to proceed urgently with other trading partners to restore momentum to the negotiations," Clinton said during a news conference this week. The United States, Canada, Japan and the European Community meet in Toronto today for preliminary trade discussions before heading to G-7 talks in Tokyo July 7-9. However, France's Prime Minister Edouard Balladur released a five- page statement on trade Thursday, rejecting the U.S.-EC farm deal and calling for a complete review of European trade policy. Balladur said that any accord negotiated in GATT talks should recognize that "general rules are not applicable to sectors, such as agriculture and aerospace, for which specific arrangements have been defined." Balladur said he wanted to dispel the idea that French farmers were the only stumbling block to a GATT agreement. He said many other non-agricultural issues needed to be settled, including aerospace, steel and procurement for public projects. "The Uruguay trade round cannot be concluded unless these differences are first resolved and the conditions for everlasting trade peace accepted," Balladur said. France's continued tough stance on global trade is likely to cause problems for the United States and European Community who are eager to push forward on trade talks. Sources: Roger Cohen, "French Disavow Accord on Farm-Trade Subsidy," NEW YORK TIMES, May 14, 1993; David Buchan, "Paris on Attack Over GATT," FINANCIAL TIMES, May 14, 1993; "U.S. House Panel Extends GATT Fast-Track Authority," REUTER, May 11, 1993; "Clinton Hopes for Progress on GATT by G-7," REUTER, May 7, 1993. ------------------------------------------------------------------------ RESOURCES ------------------------------------------------------------------------ For copies of the following resources, please mail your requests to the addresses listed. 1. "Transnational Investment and Job Loss in Chicago: Impacts on Women, African-Americans and Latinos." David C. Ranney and William Cecil, January, 1993. pp.15. University of Illinois at Chicago, Center for Urban Economic Development, M/C 345, Rice Building Suite 500, P.O. Box 4348, Chicago, IL 60680. The authors state that the promise of economic prosperity due to increased trade and investment from the NAFTA and GATT are not substantiated by their experiences in the 1980's. Many people must bear the costs of expanded trade and global economic integration that takes the form of lost jobs. The study concludes that 34% of the jobs lost in Chicago to transnational corporate parents were held by women workers. Of the dislocated workers, 27% were African- American and 23% were Latino. The study also examines dislocation in terms of occupational category. 2. "An Ecological-Economic Assessment of Further Deregulation of International Commerce Under GATT." Herman Daly and Robert Goodland, August, 1992. pp. 55. S-5043, World Bank Environment Department, 1818 H. St. NW, Washington, D.C. 20433. This paper discusses the ecological-economic implications of further deregulation of trade as promoted by GATT. The authors argue that many environmental problems cannot be resolved equitably or efficiently by unregulated markets, and that there is no alternative to public intervention in certain situations. 3. "Gattastrophe." Public Interest Research Group, February, 1993. pp. 45. 142, Maitri Apartments Plot No. 28, Indraprastha Extension, Delhi 110 092, India. "Gattastrophe" offers a clear analysis of the GATT and the politics of the Uruguay Round from a developing nation's perspective. The impact of the GATT on Indian agriculture and pharmaceutical industry is also examined in detail. 4. "Wasting the Earth: A Directory of Multinational Corporate Activities." Institute on Trade Policy, Task Force on Multinational Corporations, Compiled by George Draffan, 1993. pp. 105. P.O. Box 389, Seattle, Washington 98111-0389. Tel: (206) 783-5009. This directory looks at multinational corporations operating in any corner of the world. It focuses on "developing" countries and other areas that are particularly vulnerable to the influence of these corporations. Over one hundred pages of multinationals are cited for their activities around the world. The publication is available on a sliding scale fee basis. 5. "Runaway America: A List of Corporations That Have Moved to Mexico." Beth Sims and Harry Browne of the Resource Center, 1993. pp. 17. Box 4506, Albuquerque, NM, 87196. Tel: (505) 842-8288. This preliminary list is excerpted from the forthcoming book , "Runaway America: U.S. Jobs and Factories on the Move." It clearly illustrates the breadth of jobs and regions in the U.S. affected by runaway employers. ________________________________________________________ Produced by: Gigi Boivin and Chirag Mehta, 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 ________________________________________________________