TRADE NEWS BULLETIN Volume 2 Number 216 Monday, December 6, 1993 Headlines: FRANCE WARNS AGAINST "EXCESSIVE OPTIMISM" KOREA, JAPAN, TAIWAN CONSIDER OPENING RICE MARKETS FARMERS PROTEST AT GATT HEADQUARTERS REPORT: GATT DEAL COULD HURT EUROPEAN WAGES, ENVIRONMENT ________________________________________________________ GATT News Summary ________________________________________________________ FRANCE WARNS AGAINST "EXCESSIVE OPTIMISM" French Prime Minister Edouard Balladur said there has been "excessive optimism" about the progress in GATT talks in recent days and warned there are still significant issues to be resolved. GATT Director-General Peter Sutherland echoed Balladur's remarks, listing problems in agriculture, audio-visual trade and market access for industrial goods. Sutherland said it was "essential" that U.S. and EU negotiators reach solutions to outstanding problems today. "We are at the very eleventh hour," he said. "If no conclusion is reached, we will be in a very serious crisis." Balladur finalized France's position at a special meeting of key French ministers today. A draft agreement is expected to be presented to EU ministers later in the day. GATT officials had been hopeful the Uruguay Round was close to completion after the United States and European Union reached a tentative accord on agriculture. But France has criticized the deal, which calls for a more gradual timetable for cutting subsidized European farm exports in return for better access in Europe for a wide range of U.S. industrial and agricultural products. The deal could be worth as much as $700 million to French wheat exporters over six years as they would be allowed to export an additional 8 million tons of grain a year. In return, the U.S. would secure steep tariff cuts on U.S. exports of products including wood, paper, fruits, nuts and pork. EC Farm Commissioner Rene Steichen said he thought remaining differences could be patched up during talks today in Brussels between U.S. Trade Representative Mickey Kantor and EU Trade Commissioner Leon Brittan. But Belgian Foreign Minister Will Claes, representing the Union's current presidency, cautioned against unrealistic expectations. "I don't believe it -- by the end of the week," Claes responded when asked if a deal could be reached Monday. Sources: David Dodwell, "U.S. Deal Paves Way for Trade Pact," FINANCIAL TIMES, December 6, 1993; Jeremy Lovell, "EC/U.S. Teeter on Brink of Key Trade Deal," REUTER, December 6, 1993; Roger Cohen, "France Still Balking at Trade Pact," NEW YORK TIMES, December 6, 1993; Bob Davis, Bhushan Bahree, "Trade Accord by U.S. and EC Runs Into Snags," WALL STREET JOURNAL, December 6, 1993; Paul Ames, "GATT," December 5, 1993; "Clinton Concerned About Global Trade Pact - Interview," REUTER, December 5, 1993. ________________________________________________________ KOREA, JAPAN, TAIWAN CONSIDER OPENING RICE MARKETS South Korea and Japan appear close to giving in to international pressure to lift their bans on foreign rice imports. But ruling governments in each country risk their hold on power if they remove the bans. Over 20,000 Korean farmers shouting "Never to U.S. rice" gathered in sub-zero temperatures Sunday to protest against rice imports. "Rice is the root of Korean culture and history, and has been the lifeblood of the farmers," said an open letter to U.S. President Bill Clinton released at the rally. Police went on nationwide alert as protests continued. News reports said about 14,000 riot police would be sent to Seoul alone to prevent students and farmers from holding violent protests. Japanese Prime Minister Morihiro Hosokawa's coalition government will hold a special meeting Tuesday to discuss rice. Hosokawa was thought to be close to lifting Japan's ban. But senior members of Japan's Socialist Party, the largest in the coalition, said their party could quit the alliance if the government lifted the ban. "When the coalition government was formed, there was an agreement that the present rice policy would remain intact," one official said. "If that is violated, then the coalition's existence is threatened." Taiwan reiterated today its policy of banning rice imports but said it would closely monitor GATT talks. "So far our policy of banning rice imports has not changed at all, but we will watch closely the development of the Uruguay Round concerning farm market opening," said Sun Ming-hsien, chair of the cabinet's council of agriculture. Sources: Ju-yeon Kim, "South Korea-Rice," AP, December 5, 1993; Lim Yun-suk, "S. Korea's Police on Alert as Protest Flares," REUTER, December 6, 1993; Steve Glain, "Korea's Kim Shows Openness on Rice Issue," WALL STREET JOURNAL, December 6, 1993; "Japan Sets Special Meeting to Discuss Rice," REUTER, December 6, 1993; "Taiwan Reiterates Its Policy to Ban Rice Imports," REUTER, December 6, 1993. ________________________________________________________ FARMERS PROTEST AT GATT HEADQUARTERS Farmers from around the world demonstrated in front of GATT headquarters Saturday to protest against the Uruguay Round, which they say could have negative consequences for hundreds of millions of farmers and uproot centuries-old traditions. Police in riot gear sealed off GATT headquarters and fired tear gas to disperse farmers trying to force their way through the barricades. M.D. Nanjundaswamy, a representative of the Indian National Alliance, said plans for international patent protection will give U.S. multinationals rights over local farmers producing their own seeds. He said this would force about 450 million subsistence farmers out of business. European farmers groups said cuts in farm subsidies will cut in half the number of full-time jobs in agriculture, wipe out supply industries, empty villages and wreck traditions. Source: Clare Nullis, "GATT-Farmers," AP, December 4, 1993. ________________________________________________________ REPORT: GATT DEAL COULD HURT EUROPEAN WAGES, ENVIRONMENT A new study says a GATT accord could lead to depressed wages and lower environmental standards in Europe. The report -- "European Jobs: Is GATT the Answer?" by Tim Lang and Colin Hines of the GATT Project, argues that the movement of European jobs to lower wage regions will accelerate if the Uruguay Round is signed. "The reality for Europe is that if a GATT deal is signed, we will increase the rate of job losses to cheaper waged, more competitive economies," said Hines. "Some Europeans may get wealthier from a GATT deal but what use is it if more are out of work?" he asked. Meanwhile, world textile trade unions are calling for a new GATT accord to provide a social clause containing minimum labor standards, including freedom from child labor and discrimination. The Brussels- based International Textile, Garment and Leather Workers' Federation said laws are needed to stop the exploitation of children as cheap labor. Sources: John Tanner, "GATT Could Rollback European Jobs," INTER- PRESS SERVICE, December 2, 1993; "World Textile Unions Demand GATT Social Clause," REUTER, December 4, 1993. ________________________________________________________ Editor: 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 ________________________________________________________