TRADE NEWS BULLETIN Volume 2 Number 213 Wednesday, December 1, 1993 Headlines: U.S. HINTS ABOUT AG CONCESSIONS, FARM GROUPS PROTEST U.S. HOLDING UP TALKS OVER ANTI-DUMPING, TAX LAWS POLL: CANADIANS SPLIT ON NAFTA CLINTON PUTS CENTRAL AMERICA MEMBERSHIP ON HOLD ________________________________________________________ GATT News Summary ________________________________________________________ U.S. HINTS ABOUT AG CONCESSIONS, FARM GROUPS PROTEST The Clinton administration hinted yesterday that it was prepared to make minor agriculture concessions in the Uruguay Round. Under the EC-U.S. Blair House farm deal, the European Union must cut farm subsidies by 21 percent over six years. France is demanding that initial cuts be reduced and later increased to equal the proposed steeper cuts. U.S. Trade Representative Mickey Kantor said yesterday during an industry briefing that the controversial Blair House agreement itself would not be changed, but he left open the possibility that French and U.S. farmers' concerns could be addressed in the overall agriculture section of GATT talks. European and U.S. agriculture and environmental groups have continued independent protests against Blair House provisions and some are pressing for renegotiation of the GATT agriculture sector. Most recently, EU farm leaders from the Committee of Professional Agriculture Organizations and the International Federation of Agriculture Producers urged GATT Director-General Peter Sutherland to drop all proposed subsidy cuts from the current GATT accord. In addition, Irish farm leaders called on the government Tuesday to veto any GATT deal that would threaten Ireland's agriculture interests, particularly its beef industry. Alan Gillis, president of the Irish Farmers' Association, demanded the government agree that "any cuts on Irish agriculture resulting from a GATT deal ... and which would disproportionately penalize the Irish economy are not acceptable and will be vetoed." Irish Agriculture Minister Joe Walsh responded that the government would need to see "what's on the table before we can make an assessment of it." Ireland's beef farmers account for 24 percent of EU beef exports. The Citizens Trade Campaign, a coalition of U.S. farm, environmental, religious and consumer groups, drafted a letter urging the Clinton administration to reject the current GATT deal, arguing that provisions in the text undermine national interests ranging from food safety and environmental protection to labor rights and the future of family farmers. Sources: Douglas Jehl, "U.S.-French Trade Compromise Foreseen Soon," NEW YORK TIMES, December 1, 1993; "U.S. Is Easing Its Stance on EC Farm Subsidies," WALL STREET JOURNAL, December 1, 1993; "U.S. Hints It May Compromise in Prolonged Farm Trade Dispute," INVESTOR'S BUSINESS DAILY, December 1, 1993; "Kantor Leaves for Crucial Trade Talks in Brussels," CONGRESS DAILY, November 30, 1993; "EC Farmers Urge GATT to Drop Subsidy Cuts," REUTER, December 1, 1993; "Irish Farmers Urge Veto on GATT Farm Deal," REUTER, November 30, 1993; "Stopping the Dec. 15 Rush to a Bad GATT Deal," CTC LETTER, December 1, 1993. ________________________________________________________ U.S. HOLDING UP TALKS OVER ANTI-DUMPING, TAX LAWS GATT Director-General Peter Sutherland said U.S. demands for special provisions on trade and tax laws are holding up progress in the Uruguay Round. U.S. negotiators proposed last month that global trade rules be changed to limit the right of GATT to review U.S. rulings on dumping cases and to ensure that U.S. tax laws are exempt from global standards. The United States is pushing for the right to impose anti-dumping duties on foreign industries without being subject to a binding GATT panel review. Sutherland said the United States has virtually no support for its position, indicating that a compromise would be necessary from the Clinton administration in order for talks to move forward. But USTR Mickey Kantor yesterday told reporters that the United States would not surrender its rights to impose sanctions against countries that unfairly dump cheap products on the U.S. market. The second issue posing new problems in the Uruguay Round is the demand that current U.S. foreign tax laws be exempt from GATT tax provisions. Assistant Treasury Secretary Leslie B. Samuels argues that the United States has separate tax treaties with 56 nations -- which contain anti-discriminatory provisions -- and therefore should not be subject to globally harmonized tax laws. Sutherland said the tax issue is "creating a good deal of tension." Source: Peter Behr, "GATT Chief Criticizes U.S. Demands on Trade," WASHINGTON POST, December 1, 1993. ________________________________________________________ NAFTA News Summary ________________________________________________________ POLL: CANADIANS SPLIT ON NAFTA Canadians are divided over whether Canada should join the North American Free Trade Agreement. According to a survey by Angus Reid Group, 46 percent of Canadians oppose the accord, while 43 percent favor it. Many of the 1,500 Canadians polled believe the United States will gain more from the pact than will Canada. Legislatures in Mexico, Canada and the United States have passed NAFTA, but Canada's prime minister has refused to give the pact final approval until clarifications of the agreement are made. Source: "Canadians Split Over NAFTA, See U.S. Gaining -- Poll," REUTER, November 30, 1993. ________________________________________________ CLINTON PUTS CENTRAL AMERICA MEMBERSHIP ON HOLD U.S. President Bill Clinton yesterday told Central American leaders they would have to wait to begin negotiations to join NAFTA. USTR Mickey Kantor is expected to begin a study on trade integration sometime after December 15. Clinton did tell leaders, however, that NAFTA could "serve as a catalyst for the expansion of free trade." Guatemalan President Ramiro de Leon Carpio said the group of leaders asked Clinton to make benefits under the Caribbean Basin Initiative "equal to the NAFTA benefits." An official said there was no weakening of Clinton's previous commitment to negotiate trade arrangements with Central American nations. "It's just a complicated process that will take some time," he said. Source: Lori Santos, "Clinton Says Widening NAFTA Membership Must Await Study," UPI, November 30, 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 ________________________________________________________