TRADE NEWS BULLETIN Volume 2 Number 182 Wednesday, October 13, 1993 Headlines: CANADIAN LIBERALS PROMISE TO RENEGOTIATE NAFTA NAFTA: A TEST OF U.S. ECONOMIC VIABILITY HILLARY CLINTON BLAMED FOR NAFTA SCHEDULE WOES ADMINISTRATION TARGETS HISPANIC LAWMAKERS U.S., EC TRADE NEGOTIATORS MEET THIS WEEK TEXTILE TARIFFS STILL BEING NEGOTIATED ________________________________________________________ NAFTA News Summary ________________________________________________________ CANADIAN LIBERALS PROMISE TO RENEGOTIATE NAFTA Canadian Liberal Party leader Jean Chretien denied reports that his party would not press for changes to the North American Free Trade Agreement. Chretien called the reports "absolutely false" and vowed to renegotiate the free trade accord if his party is elected later this month. Liberals lead the ruling Conservative Party by 15 percentage points according to a recent national poll. Sources: "Chretien Denies Liberals Would Let NAFTA Through," NEWSCAN, October 8, 1993; "Canada Liberals Say Will Renegotiate NAFTA," REUTER, October 12, 1993; "Poll Puts Liberals Well Ahead After Debates," NEWSCAN, October 8, 1993. ________________________________________________________ NAFTA: A TEST OF U.S. ECONOMIC VIABILITY A report released by the Progressive Policy Institute (PPI) October 7 calls NAFTA a "test case" for the U.S.' economic future. "NAFTA itself will not be a panacea for America's economic problems; neither will it be a millstone that drags the economy down. Rather the real debate is about America's attitude toward the rules of economic engagement in the new world order," the report states. The author of the report, former International Trade Commission chair Paula Stern, argued that Americans should support the pact because increased trade with Mexico would create more U.S. jobs. Stern said the Democratic Party now faces a challenge to "demonstrate its capacity to govern in the nation's interests rather than legislate itself on behalf of narrow interests." Tom Peters, a columnist for TRIBUNE MEDIA SERVICES, wrote similarly that the United States needs to ratify NAFTA in order to achieve "economic betterment." Peters suggests that by "getting more people than our principal competitors out of hog farming and broom making and into higher-value arenas such as computers, aerospace, financial services, media and biotech," the United States would improve its standing in the world economy. Sources: "Study Sees NAFTA as Test Case," BUREAU OF NATIONAL AFFAIRS INC., October 12, 1993; Tom Peters, "NAFTA Will Keep U.S. at Front of Global Pack," MINNEAPOLIS STAR & TRIBUNE, October 12, 1993. ________________________________________________________ HILLARY CLINTON BLAMED FOR NAFTA SCHEDULE WOES Some pro-NAFTA lobbyists are blaming Hillary Rodham Clinton for making passage of NAFTA a lower priority than health care legislation. "Hillary sees NAFTA making unhappy some of the people she needs for health care," said a pro-NAFTA business lobbyist. "It's obvious that health care is a higher priority," said a Republican Senate staff aide, who cited the willingness of the Senate Finance Committee to reschedule a NAFTA hearing to accommodate Mrs. Clinton, who wanted to talk about health care. Source: Bruce Stokes, "If NAFTA's Bogging Down, Is Hillary to Blame?" NATIONAL JOURNAL, October 2, 1993. ________________________________________________________ ADMINISTRATION TARGETS HISPANIC LAWMAKERS The Clinton administration is working hard to convince the 17 Hispanic members of the House of Representatives that NAFTA would help Hispanic people on both sides of the border. Representative Luis V. Gutierrez (D-Illinois) received several phone calls last Friday from top White House officials urging him to reconsider opposition to the free trade accord. U.S. Trade Representative Mickey Kantor and Housing Secretary Henry G. Cisneros called Gutierrez one day ahead of a Chicago town meeting, during which Gutierrez was scheduled to announce formal opposition to NAFTA. Gutierrez held the town meeting as scheduled, however he told the 220 labor union members in attendance that he would give President Clinton a chance to amend NAFTA before voting "no." Gutierrez is expected to meet soon with President Clinton to discuss details of the free trade accord. Source: Clifford Krauss, "Trade Accord Hits Surprise Obstacle: Hispanic Officials," NEW YORK TIMES, October 12, 1993. ________________________________________________________ GATT News Summary ________________________________________________________ U.S., EC TRADE NEGOTIATORS MEET THIS WEEK Trade negotiators from the United States and the European Community will meet Thursday and Friday this week to discuss obstacles to the Uruguay Round of GATT. U.S. Trade Representative Mickey Kantor is expected to discuss the EC's proposal for a clarified farm accord when he meets with EC Trade Commissioner Leon Brittan. No breakthroughs are anticipated, however the Cairns Group of agricultural exporting countries warned that a weakening of the Blair House Farm accord, as demanded by the French government, would not be acceptable to other GATT members. "It would mean junking everything the Cairns Group has stood for (farm trade liberalization in the Uruguay Round) just because it is too hard for the French," said one Cairns diplomat. Source: "U.S., EC Plan Key Trade Talks, But France Seems Unlikely to Budge," INVESTOR'S BUSINESS DAILY, October 13, 1993. ________________________________________________________ TEXTILE TARIFFS STILL BEING NEGOTIATED U.S. and European textile manufacturers continue to negotiate tariff and quota cuts in the Uruguay Round of global trade talks. The JOURNAL OF COMMERCE reported that industry representatives were close to an agreement last Thursday, but that a compromise is still needed over tariff reductions. The European Community demanded that the United States cut its "peak" tariff rates by 50 percent. The U.S. offered a 30 percent reduction and a removal of import quotas over a 10-year period. Most textile exporters face tariff rates of approximately eight percent to 32 percent on goods entering the U.S. market. U.S. exporters complained that India and Pakistan have not lowered their tariffs far enough. Source: Tim Shorrock, John Maggs, "Textile Makers From U.S., Europe Wrestle With Tariff Cut Deal," JOURNAL OF COMMERCE, October 8, 1993. ________________________________________________________ Editors: Gigi DiGiacomo 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 ________________________________________________________