TRADE NEWS BULLETIN Volume 2 Number 120 Tuesday, July 6, 1993 Headlines: NEGOTIATIONS CONTINUE ON NAFTA SIDE ACCORDS U.S. PUTS RUSH ON COURT APPEAL QUAD GROUP MEETS TO DRAFT MARKET ACCESS PROPOSAL JAPAN OFFERS TRADE PROPOSAL ON EVE OF G-7 ________________________________________________________ NAFTA News Summary ________________________________________________________ NEGOTIATIONS CONTINUE ON NAFTA SIDE ACCORDS Negotiators from the United States, Canada and Mexico will meet in Mexico City July 8-10 to discuss supplemental accords to the North American Free Trade Agreement. Mexican Commerce Secretary Jaime Serra Puche said progress has been made on the labor and environmental side accords and that negotiators hope to resolve remaining problems this week. The three nations have been unable to conclude negotiations largely because of differences concerning enforcement mechanisms. The United States wants sanctions imposed against violators of environmental and labor laws, but Canada and Mexico continue to reject the proposal. Source: Bill Cormier, "Mexico-Free Trade," AP, July 3, 1993. ________________________________________________________ U.S. PUTS RUSH ON COURT APPEAL The U.S. Justice Department has requested a U.S. appeals court to conduct a quick review of U.S. District Judge Charles Richey's ruling that the United States must complete an environmental impact statement (EIS) on NAFTA. Department lawyers said the decision had already "prompted uncertainty among the United States' trading partners and members of Congress concerning the president's ability to proceed with pending and sensitive international negotiations." The Justice Department said the U.S. government would suffer "irreparable harm" if the appeal was not considered quickly. The Justice Department and the three environmental or public interest groups that filed the case agreed to submit written arguments by August 10, after which the appeals court is scheduled to hear oral arguments. Meanwhile, Vice President Al Gore said on Friday that the court ruling would not delay NAFTA, even if the appeals court requires the Clinton administration to produce an EIS. "Almost all the work required for that kind of EIS has been done," Gore said. Though he did not elaborate, Gore may have been suggesting that the Clinton administration could use an environmental study on NAFTA prepared by the Bush administration as a substitute for an environmental impact statement. Sources: Peter Behr, David S. Broder, "Gore Sees No NAFTA Approval Delay," WASHINGTON POST, July 3, 1993; "U.S. Asks For Quick Consideration of NAFTA Appeal," REUTER, July 2, 1993. ________________________________________________________ GATT News Summary ________________________________________________________ QUAD GROUP MEETS TO DRAFT MARKET ACCESS PROPOSAL Top trade officials from the United States, Japan, Canada and the European Community will meet in Tokyo today to discuss the Uruguay Round of the General Agreement on Tariffs and Trade. Hideaki Kumano, vice minister of Japan's Ministry of International Trade and Industry, said that despite little progress representatives are still hoping to present a global market access package to Group of Seven leaders before the three-day trade summit begins tomorrow. "The discussions are still going on," Kumano said. "We have not yet reached a mature stage on the issues where ministers can just ceremonially sign an agreement." The four ministers met in Toronto last week but failed to prepare the basis of an agreement. Canada, Britain, France, Germany, Italy, Japan and the United States comprise the Group of Seven leading industrialized nations. Sources: "No Agreement Yet in Four-Way Trade Talks," REUTER, July 5, 1993; "Japan Still Confident of Market Access Deal by G-7," REUTER, July 2, 1993. ________________________________________________________ JAPAN OFFERS TRADE PROPOSAL ON EVE OF G-7 Japan has offered a compromise proposal to the United States in an attempt to smooth U.S.-Japan trade relations and push G-7 talks forward. Japan offered to introduce "reference criteria" in specific markets to monitor alleged trade barriers. The "criteria" would not amount to specific targets or a commitment by Japan to buy more foreign goods. U.S. officials said Japan's offer was not acceptable and said they would continue to push for a more "results-oriented" approach to reducing Japan's $47 billion trade surplus. Japanese Prime Minister Kiichi Miyazawa told reporters after a meeting with U.S. President Bill Clinton on Monday that a results- oriented trade strategy will not reduce the growing U.S. trade deficit. Miyazawa, backed by Canadian officials, said managed trade violates free trade goals and therefore Japan would not agree to implement any of the U.S. proposals. Despite major differences both leaders remained optimistic that an accord would be struck and progress would be made to relax trade barriers at the global level. Economists in Tokyo criticized U.S.-managed trade proposals saying they would not produce long-term gains for American companies. "The distribution system is the main key to the Japanese market," said economist Hidehiro Iwaki of Nomura Research Institute Limited. Economists argue that U.S. companies need to establish contacts in the distribution system of Japanese wholesalers and retailers in order to permanently reduce the trade deficit. Sources: Gwen Ifill, "Clinton Broadens Goals for Japanese Trade Pact," NEW YORK TIMES, July 6, 1993; Linda Sieg, "U.S., Japan to Make Last Ditch Effort on Trade," REUTER, July 5, 1993; "Clinton Not to Focus on Rice Issue With Miyazawa," REUTER, July 5, 1993; Jeff Stearns, "U.S.- Japan Trade Talks May Be Missing Real Target," REUTER, July 5, 1993; Charles Leadbeater, "Japan in New Bid to Heal Rift With U.S.," FINANCIAL TIMES, July 5, 1993 Paul Blustein, "Japan Proposes Outline For U.S. Trade Accord," WASHINGTON POST, July 4, 1993. ________________________________________________________ Resources: "NAFTA Resources," INSTITUTE FOR POLICY STUDIES, June 15, 1993, 5 pages. The Institute For Policy Studies has compiled a list of NAFTA resources, including the trade pact's impact on the environment, consumers, agriculture, labor, women, human rights and immigration. The list includes 58 different studies, books, videos and newsletters. For a copy of the list contact: Institute For Policy Studies, 1601 Connecticut Avenue, NW, Washington, DC 20009. Tel: (202) 234-9382, ext: 227. Fax: (202) 387-7915. ________________________________________________________ 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 ________________________________________________________