Trade Week in Review and Resources Friday, June 17, 1994 Volume 3, Number 24 ____________________________________________________ Headlines: CLINTON TO SUBMIT GATT BILL SOVEREIGNTY QUESTIONS RAISED OVER WTO GATT HOLDS TRADE, ENVIRONMENT MEETINGS SUTHERLAND PRESSES FOR EU PASSAGE OF WTO GERMANY, SWITZERLAND BATTLE FOR WTO HEADQUARTERS RESOURCES _________________________________________________ GATT NEWS SUMMARY _________________________________________________ CLINTON TO SUBMIT GATT BILL President Bill Clinton is expected to submit GATT implementing legislation to Congress within the next week. Representative Robert Matsui (D-California), acting chair of the House Ways and Means Trade Subcommittee, said he expects to receive draft legislation by Monday. Matsui said the subcommittee would then begin discussion of outstanding issues, including anti-dumping and fast track negotiating authority. A White House official said Budget Director Leon Panetta and others have almost finalized a GATT financing plan that Republicans would support. The White House has been struggling to find ways to recover the lost federal revenues resulting from GATT's lower tariffs. The Congressional Budget Office has lowered its estimates of how much money needs to be found to pay for GATT. The new figures show Congress will need to find $10 billion to pay for the pact's first five years, down from earlier estimates of as much as $14 billion. Ways and Means Health Subcommitee Chair Pete Stark (D-California) suggested GATT legislation receive a waiver from current budget rules requiring Congress to offset any lost tariff revenues with new taxes or program cuts. Stark said health care benefits should receive a similar waiver. Sources: "President Will Transmit GATT Bill to Congress Next Week With Financing," BNA DAILY REPORT, June 15, 1994; "Matsui Outlines Plan for Considering GATT Legislation," CONGRESSDAILY, June 14, 1994; "Stark Suggests Budget Waiver for GATT and Health Care," CONGRESSDAILY, June 14, 1994; Howard Banks, "Zero-Sum Thinking on GATT," FORBES, June 20, 1994; David Wessel, Bob Davis, "Cost Estimate for Trade Pact Lowered, Raising Chances for Approval in 1994, WALL STREET JOURNAL, June 15, 1994. _________________________________________________ SOVEREIGNTY QUESTIONS RAISED OVER WTO During a hearing June 14, Senators Jesse Helms (R-North Carolina), John F. Kerry (D-Massachusetts) and other members of the U.S. Senate Foreign Relations Committee speculated that the new World Trade Organization could undermine U.S. sovereignty. The WTO "takes away the ability of the United States to veto bad decisions," Helms said. "One could refer to this new organization as a 'U.N. of world trade, without the veto.'" Defending the trade agreement, Deputy Trade Representative Rufus H. Yerxa said the WTO would actually enhance U.S. sovereignty and claimed the U.S. would retain its ability to take unilateral action against other countries under Super 301 trade law. Consumer advocate Ralph Nader said the White House was creating "a kind of illusion" of a trade pact that the U.S. would not have to adhere to but which could be used against other countries. Nader said the WTO would have the power to threaten U.S. health, safety and environmental standards. Speaking earlier in the week at a news conference organized by the U.S. Business and Industrial Council's "Save Our Sovereignty" project, Nader said, "Decision- making power now in the hands of citizens and their elected representatives would be seriously constrained by a bureaucracy and a dispute resolution body located in Geneva, Switzerland." Sources: "Senators Criticize Proposed WTO as Industry Lobbies Undecided Members," BNA, June 15, 1994; "Testimony of Senator Jesse Helms," June 14, 1994; David Briscoe, "Illusion or Reality: GATT Weak Against U.S., Tough Against Others," AP, June 14, 1994; "U.S.' Yerxa Says Super 301 Trade Law Will Be Maintained Under WTO," AFX NEWS, June 14, 1994; "New World Trade Group Could Lower U.S. Living Standards, Nader Says," BNA, June 14, 1994. _________________________________________________ GATT HOLDS TRADE, ENVIRONMENT MEETINGS GATT Director General Peter Sutherland presided over meetings last weekend of environmentalists and politicians from 100 countries who gathered to examine the impact of trade on the environment. Sutherland argued that the environment would have suffered if the Uruguay Round had failed. Environmentalists from industrialized countries argued that the Uruguay Round would undermine domestic environmental standards. Often cited were the decisions of two separate GATT panels that have ruled against the U.S. Marine Mammal Protection Act banning imports of tuna caught by fishing methods that kill dolphins. Brazil's shrimping methods, California's high auto emissions standards and Danish standards for drink containers were also discussed. Developing countries argued that many environmental standards are implemented for protectionist purposes. Often cited was the European Union's proposal to set mandatory levels for using recycled packaging and the EU's plan to label products with details of the environmental impact of that product's manufacture. The world trade body set up a committee to address these issues. It will meet for the second time next month. Source: Bronwen Maddox, "The Uruguay Round May Be Concluded, But It Leaves a Handful of Potential Trade Conflicts," FINANCIAL TIMES, June 15, 1994. __________________________________________________ SUTHERLAND PRESSES FOR EU PASSAGE OF WTO Speaking in Dublin June 13, GATT chief Peter Sutherland urged the European Union to move quickly to ratify the Uruguay Round of GATT. "Europe played a leading part in shaping the agenda of the Uruguay Round and in bringing it to a successful conclusion," Sutherland said. "The world now looks to Europe for leadership when it comes to putting those hard-won results into practice." Meanwhile, Sutherland was named the recipient of the 1994 U.S. Consumers for World Trade Award. He will receive the award from U.S. Trade Representative Mickey Kantor next Tuesday in Washington. Previous recipients of the award include former U.S. President Ronald Reagan and Mexican President Carlos Salinas de Gortari. Sources: "GATT: Sutherland Calls for Swift Ratification of Uruguay Round," EUROPEAN INFORMATION SERVICE, June 14, 1994; "GATT Chief Gets U.S. Consumer Prize," REUTER, June 15, 1994. __________________________________________________ GERMANY, SWITZERLAND BATTLE FOR WTO HEADQUARTERS Germany formally submitted its offer to base the new World Trade Organization in Bonn, but it is widely expected that Geneva, Switzerland will be the site. Germany is eager to fill dozens of government buildings in Bonn that will be left empty when the German capital moves to Berlin in 1996. Singapore has denied it is in contention for the WTO headquarters but indicated it hopes to host the first WTO ministerial meeting. In its offer, Switzerland said it would give the WTO ownership of GATT's current $40 million lakeside headquarters and construct an additional conference room. Switzerland has also offered greater immunities and privileges for WTO staff and diplomatic missions than GATT. In addition, the Swiss government said it would offer free premises for diplomats from "least developed countries." Developing countries have said a Bonn site would be too expensive. A Geneva site enables a single mission to cover the range of international organizations. Sources: Frances Williams, "Bonn Offered as Base for WTO," FINANCIAL TIMES, June 15, 1994; Philippe Naughton, "Swiss Try to Entice New World Trade Body," REUTER, June 15, 1994; Robert Evans, "States Jostle for Site, Head of New Trade Body," REUTER, June 14, 1994. __________________________________________________ RESOURCES _________________________________________ For copies of the following, please contact the authors or organizations listed: "Effects of Unfair Imports on Domestic Industries: U.S. Antidumping and Countervailing Duty Cases, 1980 to 1988," Morris E. Morkre and Kenneth H. Kelly, FEDERAL TRADE COMMISSION, 1994. 120 pages. Federal Trade Commission. 6th Street and Pennsylvania Avenues NW, 1st Floor, Public Reference Row 130, Washington, DC 20580. (202) 326-2000. Fax. (202) 326-2050. Free. "Our findings are at variance with the popular perception that unfair imports inflict widespread harm on domestic industries." "Globalized Agriculture: Political Choice," Richard Le Heron, PERGAMON PRESS, 1993. 231 pages. Elsevier Science Ltd., The Boulevard, Langford Lane, Kidlington, Oxford OX5 1GB, United Kingdom. (44-865) 843000. $32. Chapter topics include "Agriculture and regulation," "The US Model of agricultural regulation," "The EC and the common agricultural policy," "GATT and agriculture" and "The Politics of globalized agriculture." The author writes, Rin studying the industrialization of agriculture we are focusing on long run changes made under capitalism to bio- physical or natural production processes.S "The Development Dictionary: A Guide to Knowledge as Power," ed. Wolfgang Sachs, ZED BOOKS, 1992. 306 pages. Humanities Press, 165 First Avenue, Atlantic Highlands, NJ 07716-1289. (908) 872-1441. Fax: (908) 872-0717. $25. ____________________________________________________ The following email services are offered by the Institute for Agriculture and Trade Policy: "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. 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