Trade News and Recent Publications August 14-20 1993 Volume 2 Number 150 Headlines: REACTIONS TO ANNOUNCEMENT OF SIDE AGREEMENTS SUTHERLAND SAYS GATT COMPLETION WILL BENEFIT CONSUMERS JAPAN URGED TO WORK FOR GATT CONCLUSION ________________________________________________________ NAFTA News Summary ________________________________________________________ U.S., Mexican and Canadian lawmakers, labor groups and citizen organizations had mixed reactions to Friday's announcement that supplemental accords to the North American Free Trade Agreement had been completed. Many groups remain in opposition to the pact, while others are supporting it. -Canadian Reactions- Canadian business officials and members of the conservative government welcomed the completion of NAFTA side accords, but liberals and labor leaders said the accords fail to address problems in the original NAFTA text. Manitoba's Progressive Conservative Premier Gary Filmon said he expects NAFTA to help his province increase exports to Mexico. Ontario's National Democratic Party Premier Bob Rae said the side agreements would fail to halt job losses. -Mexican Opposition Denounces NAFTA- Mexico's Revolutionary Democratic Party (PRD) leader Porifirio Munoz Ledo criticized supplemental accords saying they will not resolve deeper environmental and labor problems. The National Action Party (PAN) withheld its evaluation of side accords until it has had a chance to analyze them. Meanwhile, Mexican President Carlos Salinas de Gortari said he hopes the U.S. Congress is "up to its historical responsibility" to pass the treaty. He said he would not be involved in U.S. lobbying efforts. -Congressional Opposition Heats Up- Representative Sander Levin (D-Michigan) said many formerly undecided Democrats are "disappointed" with supplemental accords and plan to reject the pact. House Majority Leader Richard Gephardt (D-Missouri) stated the completed side deals "fall short in important respects, and, taken alone, are not supportable." House Majority Whip David Bonior (D-Michigan), who has consistently opposed the pact, criticized final side deals, saying, "All the fanfare about the completion of the side agreements can't hide this simple fact: NAFTA still threatens to make American jobs our number one export." President Clinton acknowledged it would be difficult to pass NAFTA without the support of Gephardt and Bonior. A number of Republicans, who had threatened to oppose NAFTA if side agreements were too powerful, now support the trade pact. -Daley Named NAFTA "Czar"- In an effort to win congressional support, Clinton appointed William Daley to steer NAFTA through Congress. To do so, Daley will need to win the support of many House Democrats and powerful labor unions. Daley, former president of the Amalgamated Bank, which was founded by the Amalgamated Clothing workers of America, may gain some labor support because of his strong ties with unions. -U.S. Labor, Farm, Environmental Groups Say Side Accords Failed- Members of the Arkansas AFL-CIO and the American Agriculture Movement (AAM) said President Clinton failed to correct problems in the NAFTA text through the side accords. "President Clinton sought side agreements to correct the problems of the Bush-negotiated treaty," said the AFL-CIO board in Arkansas. "Unfortunately, his negotiators failed." Harvey Sanner, spokesperson for AAM, echoed the labor group's opposition, saying he wants Clinton to put people first and let them "have a say in the negotiation of this agreement." "The NAFTA trade negotiations have resulted in protection for monied and investment interests but not for the working people," said Robert Healey, president of the Chicago Federation of Labor. "The side agreements would relegate workers rights to a committee with no power to impose trade sanctions." A number of other citizen and labor groups issued strong statements in opposition to the accord. Groups include: Illinois Public Action, Chicago Federation of Labor, the Teamsters, the Chicago Amalgamated Textile and Clothing Workers Union, and the Fair Trade Campaign, a coalition of labor, environmental and church groups. -Aides Begin to Draft NAFTA Bill- Congressional aides have reportedly begun organizing the basic elements of the bill to implement NAFTA. Discretionary proposals, including funding mechanisms for border cleanup, infrastructure improvements and worker retraining, are being discussed, however, they will not be included in the bill's first draft, scheduled for mid- September. Congressional members are also expected to attach other trade proposals, such as extension of the Super 301, to the NAFTA bill. Sources: Peter Behr, "Daley to Manage NAFTA Push," WASHINGTON POST, August 20, 1993; "Brother of Chicago Mayor Daley Asked to Shepherd NAFTA Pact," INVESTOR'S BUSINESS DAILY, August 20, 1993; Paul B. Carroll, Dianne Solis, "NAFTA Is an Opportunity the U.S. Shouldn't Miss, Salinas Contends," WALL STREET JOURNAL, August 19, 1993; "NAFTA Threatens to Attract Wave of Trade Proposals," CONGRESS DAILY, August 18, 1993; "NAFTA Needs Help, State AFL- CIO Says," ARKANSAS TODAY, August 18, 1993; "Opposition Responds to Announcement," EQUIPO PUEBLO/RMALC, August 18, 1993; "NAFTA Side Deals Fail to Sway Pact's Chief Foe," JOURNAL OF COMMERCE, August 16, 1993; Janet Kidd Stewart, "Groups Bash, Cheer NAFTA Deal," CHICAGO SUN TIMES, August 16, 1993; "Canadians Split on NAFTA Side Deal Agreements," UPI, August 13, 1993. ________________________________________________________ GATT News Summary ________________________________________________________ SUTHERLAND SAYS GATT COMPLETION WILL BENEFIT CONSUMERS Peter Sutherland, GATT director-general, criticized "protectionist" measures adopted by many of GATT's leading members and said consumers would benefit under a GATT accord. "It is high time governments made clear to consumers just how much they pay, in the shop and as taxpayers, for decisions to protect domestic industries from import competition," Sutherland wrote in a GATT report released Monday. "The Uruguay Round will mean significant improvements in prices, choice and quality for consumer products across the board." Sources: "Protectionism Costly to Consumers, GATT Warns," REUTER, August 16, 1993; K.M. Rockwell, "GATT Chief Wants Cost of Protectionism Known," JOURNAL OF COMMERCE, August 16, 1993. ________________________________________________________ JAPAN URGED TO WORK FOR GATT CONCLUSION Members of a House trade subcommittee urged Japan to take the lead in concluding the long-stalled Uruguay Round of GATT talks. "It is important for Japan to promote deregulation and boost domestic demand," said a spokesperson for Representative William Thomas (R- California). "But the most important thing for the world economy is to conclude the Uruguay Round by the end of this year." The Federation of Employers' Associations (Nikkeiren) recently called on the Japanese government to make a complete review of its farm policies on rice, and accept the GATT proposal to gradually open the market to international imports. Japanese Agriculture Minister Eijiro Hata firmly rejected the proposal. Sources: "Japan Farm Minister Slams Plan to Free Rice, Beef," REUTER, August 20, 1993; "U.S. Urges Japan to Take Lead on GATT Talks," REUTER, August 20, 1993. ________________________________________________________ Recent Publications on International Trade ________________________________________________________ For copies of the following, contact the authors or organizations listed. All prices in U.S. dollars. "NAFTA's Corporate Cadre: An Analysis of the USA* NAFTA State Captains," Sarah Anderson, John Cavanagh and Sandra Gross, INSTITUTE FOR POLICY STUDIES, July 1993. 1601 Connecticut Ave. NW, Washington, DC 20009. (202) 234-9382. Fax: (202) 387-7915. Free. The study finds that the majority of the corporations in the USA* NAFTA organization have been eliminating jobs over the past three years and a number of them have been shifting work to Mexico. USA* NAFTA is the leading pro-NAFTA organization in the U.S., composed of about 2300 U.S. corporations and lobby groups. "Multinational Enterprises and the World Economy," John Dunning, ADDISON-WESLEY, 1993. 704 pages. Jacob Way, Reading, MA 08167. (617) 944-3700. Fax: (617) 944-0826. $58.50. This book illustrates the impact of multinational corporate activity on national economies, government policies towards multinationals, the determinants of foreign direct investment, and the scope and form of multinational activity. "Difficult Liaison: Trade and the Environment in the Americas," Geraldo Munoz and Robin Rosenberg, eds., NORTH-SOUTH CENTER, August 1993. 304 pages. Transaction Publishers, Rutgers - The State University, New Brunswick, NJ 08903. (908) 932-2280. Fax: (908) 932-3138. $21.95. This book outlines an approach for fair and effective environmental regulations that can be implemented within hemispheric economic integration. "Implementing the World Bank's Strategy to Reduce Poverty, Progress and Challenges," WORLD BANK, 1993. Publications Department, P.O. Box 7247-8619, Philadelphia, PA 19170-8619. (202) 473-1234. $7.95. The report states that sustainable poverty reduction is the World Bank's fundamental objective. The authors also identify the need for developing countries to make efficient use of labor, to increase access to social services, and to increase funding for physical infrastructure. "Privatization 1993," William D. Eggers, ed., REASON FOUNDATION, 1993. 3415 Sepulveda Blvd., Suite 400, Los Angeles, CA 90034. $35. This report contains a state-by-state breakdown of privatization efforts. The authors claim that cost savings are usually the chief motivation for privatization; other reasons include the lack of in- house expertise, insufficient public facilities and the prospect of improved services. "U.S. Agriculture and the North American Free Trade Agreement," COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY, July 1993. 37 pages. 137 Lynn Avenue, Ames, IA 50014. (515) 292-2125. Fax: (515) 292-4512. $10. ________________________________________________________ Editors: Gigi Boivin, Chirag Mehta and 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 ________________________________________________________