TRADE NEWS BULLETIN Volume 2 Number 214 Thursday, December 2, 1993 Headlines: FRANCE HARDENS POSITION FOLLOWING TALKS WITH GERMANY NEW YORK TIMES DISMISSES 'MAGIC' DECEMBER DEADLINE JAPAN ASKS OECD TO FILL HOLES IN PROPOSED GATT DEAL PRI PRESIDENTIAL CANDIDATE ANNOUNCED ________________________________________________________ GATT News Summary ________________________________________________________ FRANCE HARDENS POSITION FOLLOWING TALKS WITH GERMANY Following two days of talks, French President Francois Mitterrand and German Chancellor Helmut Kohl pledged to make "real efforts" to reach a compromise in GATT talks. "It is our common goal to ensure that GATT reaches a positive conclusion," Kohl said yesterday. "We know how important this decision is not only for free world trade, but also for the cohesion of Europe, and for relations between our countries." But France appears to have hardened its position following the talks. French Prime Minister Edouard Balladur outlined four broad areas that remain in dispute: the creation of a new body to supervise world trade rules; France's desire to establish rules protecting its audio- visual industry; disagreement over market access rules; and differences over textiles, steel, financial services and agriculture issues. "We are resolutely determined, in liaison with our German partners and all our other European partners, to obtain satisfaction on all points listed," Balladur said. "If we obtain them, we can give our accord. If we don't obtain them, then of course we can't." France's appeal for cultural exemption in GATT may also include provisions to restrict the airing of violent films. French Communication Minister Alain Carignon asked Parliament to approve proposals to crack down on broadcasting violent television programs and said he wants to prevent broadcasts of violent films from abroad into France. Sources: Quentin Peel, "Mitterrand and Kohl in GATT Pledge," FINANCIAL TIMES, December 2, 1993; Elaine Sciolino, "U.S. Raises Pressure for Trade Accord," NEW YORK TIMES, December 2, 1993; "France Takes Aim at TV Violence," WALL STREET JOURNAL, December 2, 1993; Scott Kraft, "'Dinos' and GATT," MINNEAPOLIS STAR & TRIBUNE, December 2, 1993. ________________________________________________________ NEW YORK TIMES DISMISSES 'MAGIC' DECEMBER DEADLINE Many GATT negotiators have called December 15 an all-or-nothing target date to complete the Uruguay Round. If it doesn't get done by then, when U.S. fast-track authority expires, they say the chances for U.S. legislative approval would be slim and the talks could be permanently blocked. U.S. Secretary of State Warren Christopher recently warned, "There will be no December 16" if negotiators miss the deadline. But the NEW YORK TIMES says today what others have been saying all along: that there is nothing "magic" about the December 15 date. French government officials argued earlier this week that even if GATT talks did collapse, they would not prevent world partners from trading as they always have. Meanwhile, Clyde Prestowitz, president of the Economic Strategy Institute, rejected some predictions of the benefits of a GATT agreement and said current proposals fall short of "initial objectives." He estimated that the global trade pact could boost the U.S. trade deficit by $10 billion to $30 billion, resulting in a net loss of "thousands of jobs." Sources: Elaine Sciolino, "U.S. Raises Pressure for Trade Accord," NEW YORK TIMES, December 2, 1993; Lionel Barber, David Dodwell, "'Cautious Optimism' on Trade Talks Outcome," FINANCIAL TIMES, December 2, 1993; Chuck Freadhoff, "Last-Minute GATT Bargaining May Set Future for Many Firms," INVESTOR'S BUSINESS DAILY, December 2, 1993; Hobart Rowen, "This GATT or None," WASHINGTON POST, December 2, 1993. ________________________________________________________ JAPAN ASKS OECD TO FILL HOLES IN PROPOSED GATT DEAL A senior Japanese trade official complained to the Organization for Economic Cooperation and Development (OECD) that Uruguay Round proposals would not prevent the United States from forming bilateral trade and investment deals that discriminate against Japan. Norburu Hatakeyama, an advisor to the Ministry of International Trade and Industry (MITI), told OECD members that Uruguay Round proposals would remove "trade-related investment measures" such as those requiring investors to export a certain share of their production, and remove discrimination in the service sector. "But," he said, "this GATT Round will not deal with discrimination in industrial or agricultural investment ... That is a big hole, which perhaps the OECD can help fill," Hatakeyama said. Hatakeyama referred to recent U.S. proposals requesting that Japanese electronics companies purchase up to 20 percent of their semiconductors from foreign sources. In another bilateral discussion, the United States asked Japan to issue guidelines to its U.S.-based auto industries requiring them to purchase parts from U.S. suppliers. Although OECD declarations have no binding force on member countries, Hatakeyama hopes that his "political declaration" will gain enough support so that "bit by bit many OECD countries, including the U.S., will abide by it." Source: David Buchan, "Japan Seeks Protection From Discriminatory Deals," FINANCIAL TIMES, December 2, 1993. ________________________________________________________ NAFTA News Summary ________________________________________________________ PRI PRESIDENTIAL CANDIDATE ANNOUNCED Mexican Social Development Minister Luis Donaldo Colosio was nominated Sunday as the ruling Institutional Revolutionary Party (PRI) presidential candidate. PRI officials say Colosio has broad support largely because of his multi-billion dollar spending on an anti-poverty campaign, environmental clean-up and housing and infrastructure programs. "Mr. Colosio is known by all of us and we will work for him," said Mario Ruiz, municipal president from Naucalpan. During his acceptance speech Sunday night, Colosio strongly endorsed President Salinas' pro-market economic policies and pledged to continue the government's anti-poverty program. The WALL STREET JOURNAL reported "muted" reaction in Mexico Monday to Colosio's nomination. PRI candidates have controlled elections for the past 64 years. Sources: Damian Fraser, "Mr. Continuity Set to Succeed Salinas," FINANCIAL TIMES, November 30, 1993; Paul B. Carroll, "Rare Rift in Mexico's Ruling PRI Is Quickly Patched Up by Salinas," WALL STREET JOURNAL, 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 ________________________________________________________