TRADE NEWS BULLETIN Volume 2 Number 107 Wednesday, June 16, 1993 Headlines: CLINTON SAYS NAFTA WILL RAISE LIVING STANDARDS BALLADUR CALLS FOR NEW GATT FOCUS GATT CALLS LOME CONVENTION A VIOLATION OF TRADE RULES ________________________________________________________ NAFTA News Summary ________________________________________________________ CLINTON SAYS NAFTA WILL RAISE LIVING STANDARDS U.S. President Bill Clinton argued the United States would gain more jobs than it would lose under the North American Free Trade Agreement, and claimed that, if passed, the trade pact would improve the standard of living for U.S. citizens. During a news conference Tuesday, Clinton said the promise of NAFTA had already shown positive signs. The U.S. trade imbalance with Mexico has improved from a $5 billion deficit several years ago to a $6 billion surplus last year. "There are over 80 million Mexicans. As their incomes go up they will buy more from us," Clinton said. "If we can work out an agreement with them we will then be able to work out similar agreements with countries even further from us but within our region, in Latin America." In an editorial, the WALL STREET JOURNAL praised Clinton for expressing a "visionary concept" of NAFTA. "The President seems to have both a gut understanding of the importance of NAFTA and the intellectual background to shoot down arguments against it," the newspaper said. But it concludes that Clinton's "eloquent defense of the issue" will not be enough to win congressional approval. "To win, the President is going to have to get his own people fully in tune with his own clear, unfudged defense of NAFTA," the editorial said. Source: "Good-Looking Clinton," WALL STREET JOURNAL, June 16, 1993; "Clinton Defends NAFTA," UPI, June 15, 1993. ________________________________________________________ GATT News Summary ________________________________________________________ BALLADUR CALLS FOR NEW GATT FOCUS French Prime Minister Edouard Balladur called for the United States and the European Community to join together in pursuit of a new GATT trade agenda. Ahead of talks with President Bill Clinton in Washington yesterday, Balladur told reporters the time has come for the EC and U.S. to resolve trade conflicts and work to protect their high living standards against challenges from Asia and Latin America. "GATT should no longer be seen as a confrontation between the United States and Europe," Balladur said. "The question now is how to organize to protect ourselves from countries whose different values enable them to undercut us." He said fast-growing developing nations that have benefited from cheap wages, closed domestic markets and easy access to high technology should assume greater responsibility in securing a global trade accord. Balladur's call to resolve trade disputes came a week after France agreed to sign an EC-U.S. oilseed accord, which is part of a larger agriculture deal known as the Blair House agreement. A dispute over the deal continues as the United States remains committed to the original farm pact but France refuses to sign. "There is no Blair House agreement," Balladur told reporters after meeting with Clinton. "I said the agreement was not satisfactory to us and it could not be accepted by us in its present state." Meanwhile, French grain producers plan to mount a campaign against the Uruguay Round of GATT. The French Wheat Producers' Association (AGPB) said they would begin planning during their annual meeting in Grenoble today. Henri de Benoist, head of the AGPB, said they plan to focus on the corn gluten feed clause of the U.S.-EC farm deal, which they fear will be passed by the European Commission without a formal vote. French grain producers claim the pact would increase EC grain imports by more than three million tons, thus reducing their own production by a commensurate amount. De Benoist said French farmers are gaining support from other industry sectors. Sources: Juliette Rouillon, "French Grain Producers Seek New Ways to Block GATT," REUTER, June 16, 1993; Steven Holmes, "Despite Farm Pact, France Still Talks Tough on Trade," NEW YORK TIMES, June 16, 1993; William Drozdiak, "Balladur Asks U.S. to Join in Cracking New Markets," INTERNATIONAL HERALD TRIBUNE, June 15, 1993; "Balladur Tells Clinton France Against Farm Treaty," REUTER, June 15, 1993. ________________________________________________________ GATT CALLS LOME CONVENTION A VIOLATION OF TRADE RULES A GATT panel has ruled against the Lome convention, which provides preferential trading arrangements between the European Community and its former colonies. The panel found in favor of Latin American banana exporters who claim the convention is discriminatory and unfair because it provides African, Caribbean and Pacific banana producers with preferential treatment. The panel said the convention violates international trade rules, particularly GATT's principle of "most favored nation" trade status requiring that trade preferences established with one country be extended to all. The Council of the General Agreement on Tariffs and Trade is expected to call for changes in the EC's banana import regime. EC agriculture ministers said they would block the panel conclusion by applying for a waiver from GATT rules. "We are not going to formally reject it," said an EC spokesperson. "We're simply going to say it is an important policy for us and we need time to consider its implications for the next Council meeting." The EC said it will propose that a two million ton per year quota be adopted for Latin American fruit. These imports will face a duty of Ecu100 per ton, and any imports above the quota will be hit with an Ecu850 per ton duty. The quota would go into effect July 1, 1993, when the old Lome arrangement expires. Sources: David Dodwell, Canute James, "GATT Attacks Lome Convention Over Bananas," FINANCIAL TIMES, June 16, 1993; "EC to Block GATT Panel Report on Banana Regime," REUTER, June 16, 1993. ________________________________________________________ Event: "'Rap' Against Free Trade," a speaker's training session focusing on NAFTA, organized by the JOBS WITH JUSTICE campaign. Saturday, June 19, Cambridge, MA, 9:00am-12:00 noon. Contact: Sue Anderson, Central American Solidarity Association, (617) 492-8699 or Jobs With Justice, 408 Highland Ave., Somerville, MA 02144. ________________________________________________________ Produced by: 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 ________________________________________________________