TRADE WEEK Volume 3, Number 23 Friday, June 10, 1994 _________________________________________________ Headlines: U.S., FRANCE TO HOLD AUDIOVISUAL TALKS SWITZERLAND BEGINS RATIFICATION PROCESS BRAZILIAN FINANCE MINISTER CANDIDATE TO HEAD WTO MEMBERS MUST REFINE FINANCIAL SERVICES RESEARCHERS SAY GATT AG PROVISIONS WILL DO LITTLE TO LIBERALIZE MARKETS U.S. SENDS MIXED MESSAGE TO JAPAN RESOURCES _________________________________________________ GATT News Summary _________________________________________________ U.S., FRANCE TO HOLD AUDIOVISUAL TALKS The United States and France have agreed to hold informal audiovisual talks aimed at resolving differences that stalled GATT negotiations last year. French laws mandate that at least 60 percent of all television broadcasts and movies be EU-produced, which U.S. film, television program and home video makers claim prevents them from earning billions of dollars in European sales. The United States pushed hard during GATT negotiations to liberalize the EU audiovisual sector under the Uruguay Round. France rejected U.S. demands last December, but agreed to discuss the issue at a later, unspecified date. U.S. Trade Representative Mickey Kantor and his French counterpart Gerard Longuet agreed Monday during the annual meeting of the Organization of Economic Cooperation and Development to begin pursuing audiovisual talks. Government officials, as well as labor and industry representatives, will take part in the talks. Sources: "After GATT Pique, Pix Pax Promoted," REUTER, June 8, 1994; "U.S., France Agree to New Talks on Dispute Over U.S. Movies, TV," INVESTOR'S BUSINESS DAILY, June 8, 1994. __________________________________________________ SWITZERLAND BEGINS RATIFICATION PROCESS The Swiss government has begun the GATT ratification process by opening up the agreement for consultations. Under Swiss law, the accord will be open to interested parties for consultation this year, after which the document will move to Parliament. Once in Parliament, ratification will be delayed for three months in the case a referendum is called. Fifty thousand signatures on a petition are needed to force a referendum, thereby giving Swiss voters the final say on the Uruguay Round. Opposition to the accord is expected from Switzerland's farm sector. Swiss Economics Minister Jean-Pascal Delamurz said the country's farming sector will suffer under new GATT rules requiring lower subsidies, especially on products like cheese exports. Switzerland will need to change at least 16 laws if the GATT treaty passes Parliament. Source: "Swiss Government Begins GATT Ratification Process," JOURNAL OF COMMERCE, June 1, 1994. __________________________________________________ BRAZILIAN FINANCE MINISTER CANDIDATE TO HEAD WTO Brazil officially endorsed Rubens Ricupero, Brazil's finance minister and former GATT ambassador, as the country's candidate to head the World Trade Organization. Brazil notified Andras Szepesi, chairperson of the GATT contracting parties who is in charge of the WTO selection process, of the government's decision. Although the top trade post has traditionally been filled by a European, press reports indicate that developing nations will push hard for one of their candidates to head the trade organization. The FINANCIAL TIMES reports that Ricupero is "set to win wide Latin American support" for the post. Latin American candidates received strong support against GATT's current chief Peter Sutherland during last year's selection process. Source: Frances Williams, "Brazilian Nominated to Lead WTO," FINANCIAL TIMES, June 9, 1994. __________________________________________________ MEMBERS MUST REFINE FINANCIAL SERVICES GATT Director-General Peter Sutherland urged signatories to refine their provisional framework agreement on financial services during the first six months of 1995, and warned that failure to do so could have a significant negative impact on the world's financial markets. "It would be a serious blow to the hopes of the financial services industry for an effective framework within which to maintain its growth and secure further market opening on a non-discriminatory basis," Sutherland cautioned. GATT members agreed during Uruguay Round negotiations to put contentious financial decisions on hold until after the creation of the WTO. Source: "Sutherland Urges GATT Members to Enlarge Services Negotiations," BNA BANKING DAILY, June 8, 1994. _________________________________________________ RESEARCHERS SAY GATT AG PROVISIONS WILL DO LITTLE TO LIBERALIZE MARKETS Researchers at the Hamburg Institute for Economic Research (HWWA) recently concluded that GATT agriculture provisions will be relatively ineffective at achieving liberalization in the world's agriculture markets. An article in an HWWA bi- monthly publication states that the definition of reference periods, the exclusion of some types of subsidy payments and the inclusion of many safeguard mechanisms means "... a radical reduction of protectionism cannot be expected for the time being." Source: "Further GATT Farming Efforts Needed -- Researchers," REUTER, June 8, 1994. ___________________________________________________ Other Trade News __________________________________________________ U.S. SENDS MIXED MESSAGE TO JAPAN The U.S. administration has been sending Japan inconsistent messages on how it plans to approach July's bi-lateral trade talks. USTR Mickey Kantor hinted Tuesday that the Clinton administration was willing to "take what we can get and move on," rather than continue pressing for a comprehenisve frame work agreement on autos, insurance, medical equipment and telecommunications. But, just a few days later, Kantor renewed his call for an aggressive approach to opening Japanese markets. "We will open Japanese markets through the framework agreement or using U.S. trade laws," he said. One explination, notes a NEW YORK TIMES article, is the Clinton administration's struggle to balance America's "superpower legacy" against the need to reduce its huge federal deficit. "It is our net debtor status, and our current account deficit, that imposes an inherent limitation on our freedom of action in international trade policy," said John Lipsky, chief economist with Salomon Brothers. Meanwhile, U.S. and Japanese negotiators recently agreed to broaden their talks to include banking and information services, such as the protection of copyrights, patents and other intellectual property. Sources: "U.S. Goals Unchanged in Japan Talks: Kantor," INVESTOR'S BUSINESS DAILY, June 8, 1994; Thomas L. Freidman, "A Giant Restrained," NEW YORK TIMES, June 8, 1994; "U.S., Japan to Include Banking in Trade Talks," INVESTOR'S BUSINESS DAILY, June 8, 1994; "Garten Says Has Hope in Japan Telecom Disputes," REUTER, June 6, 1994. _________________________________________________ Resources __________________________________________________ For copies of the following, please contact the authors or organizations listed: "Trade and the Environment: Law, Economics and Policy," eds. Durwood Zaelke, Paul Orbuch and Robert F. Housman, CENTER FOR ENVIRONMENTAL LAW, November 1993. 318 pages. Island Press, 1718 Connecticut Avenue, NW, Suite 300, Washington, DC 20009. (202) 232-7933. Fax: (202) 234-1328. Cloth/$49.95. Paper/$24.95. Twenty essays from a variety of ideological perspectives in business, government, academe and non-governmental organizations. "The Ecology of Commerce: A Declaration of Sustainability," Paul Hawken, November 1993. 250 pages. Harper Business, 10 East 53rd Street, New York, NY 10022-5299. (212) 207-7000. Fax: (800) 822-4090. $23. "If you think creating enough well-paying jobs to retain America's current living standard is challenging, it's child's play compared to what Paul Hawken says we must do next: Convert to an economy that sustains rather than destroys the earth." (from a review by Peter Barnes in THE NATION, February 7, 1994) "Savings and Investment in a Global Economy," Barry P. Bosworth, THE BROOKINGS INSTITUTION, 1993. 188 pages. Brookings Institution, 1775 Massachusetts Avenue NW, Washington, DC 20036. (202)-797-6258. $28.95. "Most economists believe that trade practices are not the primary determinants of the [trade] imbalances. Rather, they put a large emphasis on the role of the domestic patterns of aggregate saving and investment." "Dictionary of International Trade," Jerry M. Rosenberg, JOHN WILEY AND SONS, INC., 1994. 314 pages. John Wiley and Sons, Inc., 1 Wiley Drive, Somerset, NJ 08875-1272. (212) 850-6000. $14.95. >From "AA (always afloat)" to ZWD "the international standard code for the currency of Zimbabwe -- the Zimbabwe dollar." This dictionary is particularly useful for explaining the proliferating acronyms of international trade. "Revitalizing Antitrust in Its Second Century," eds. Harry First, Eleanor M. Fox and Robert Pitofsky, QUORUM BOOKS, 1991. 568 pages. Greenwood Publishing Group, 88 Post Road West, PO Box 5007, Westport, CT 06881-5007. (800) 225-5800. Fax: (203) 222-1502. $65. _________________________________________________ The following email services are offered by the Institute for Agriculture and Trade Policy: "trade.news" - a weekly bulletin summarizing the latest trade developments "trade.library" - a storehouse of trade related documents, including analyses, reports, fact sheets, White House transcripts ... etc. "trade.strategy" - an open discussion of trade issues and events "eai.news" - a regular bulletin summarizing the latest news in Latin American integration and development "susag.news" - a regular news bulletin pertaining to sustainable agriculture "susag.library" - longer documents, studies and analyses on sustainable agriculture "susag.calendar" - a calendar of events "env.biotech" - a news bulletin about biotechnology If you are on EcoNet/PeaceNet, you may access these services by going to the "conferences" section. If you are on another system and would like to be added to the e-mailing list for these services, send email to "kmander@igc.apc.org" with a note requesting to which lists you'd like to be added. Trade Week in Review is produced by: Gigi DiGiacomo and Kai Mander Institute for Agriculture and Trade Policy (IATP) 1313 5th Street, SE, Suite 303 Minneapolis, MN 55414-1546 USA tel: (612) 379-5980 fax: (612) 379-5982 email: kmander@igc.apc.org ____________________________________________________