From iatp@igc.apc.orgFri Sep 22 10:29:03 1995 Date: Thu, 21 Sep 1995 07:41:43 -0700 (PDT) From: IATP To: Recipients of conference Subject: Trade News 9-20-95 TRADE NEWS Produced by the Institute for Agriculture and Trade Policy Volume 4, Number 14 SEPTEMBER 19, 1995 __________________________________________ Headlines: - CHILE AND MERCOSUR TO NEGOTIATE - U.S. AND JAPAN AVERT SOFTWARE DISPUTE - APEC BU.S.INESS GROUP WANTS FASTER LIBERALIZATION - ASEAN SETS DEADLINE FOR FREE TRADE ZONE - CEFTA WILL ADMIT SLOVENIA - ANDEAN NATIONS WILL JOIN SPECIAL U.S. TEXTILE PROGRAM - REPUBLICANS PUT OFF FAST-TRACK VOTE __________________________________________ REGIONAL/BILATERAL AGREEMENTS __________________________________________ CHILE AND MERCOSUR TO NEGOTIATE Negotiating teams from Chile and the four Mercosur countries - Argentina, Brazil, Paraguay and Uruguay - will meet in Montevideo, Uruguay next week to begin work on a trade agreement that could be ready by the end of November. Trade officials say the countries will discuss the exemption list that Chile and Mercosur exchanged on August 21, 1995 and possibly identify what goods will be exempted from tariffs under a general lowering of trade barriers. Foreign minister Jose Miguel Insuiza said that Chile could strike a deal before November 30 that would allow the country to enter Mercosur, but Carlos Mladinic, the government's director of international economic relations, qualified the position by saying that Chile will not sign anything that does not conform with its national interests. Some Chileans are anxious that negotiated compromises with Mercosur will jeopardize the security of their investments in Argentina and Brazil. "Chile, Mercosur to Negotiate This Month on Trade Agreement," JOURNAL OF COMMERCE, September 1, 1995. U.S. AND JAPAN AVERT SOFTWARE DISPUTE On August 29, the United States and Japan averted a potentially bitter dispute over software certification involving billions of dollars a year in U.S. exports when the Japanese Accreditation Board, a Japanese standards body, agreed to drop a proposal that would have made U.S. and other non-Japanese software subject to a new certification procedure in Japan. The proposal would have required foreign software manufacturers to meet a Japanese quality standard based on but different from a widely accepted standard known as the International Standard Organization (ISO) 9000. According to U.S. software manufacturers, the proposal could have seriously affected their Japanese sales. The United States is Japan's largest software supplier. Richard Lawrence, "U.S. and Japan Avert Dispute Over Software Certification," JOURNAL OF COMMERCE, August 31, 1995. APEC BUSINESS GROUP WANTS FASTER LIBERALIZATION Earlier this month, the Pacific Business Forum, a group of 36 business leaders from the 18 nations that comprise the Asia Pacific Economic Cooperation (APEC) forum, called for accelerated tariff reductions as well as specific measures to enhance private investment in the region. The group will present its recommendations later this month to Japanese Prime Minister Tomichi Murayama, current chairman of APEC. In addition to calling for tariff reductions that should occur sooner than those officially adopted by the World Trade Organization (WTO), the Pacific Business Forum called for the following measures: increased cooperation to safeguard intellectual property rights by the year 2000; more liberal investment regulations in APEC's industrialized members by the year 2000 and by 2005 for the developing nations; visa-free travel throughout the region by 1999; simplified procedures for obtaining business residency visas by 1996; and a range of policies to promote the development of small and medium- sized businesses by 1998. The group also called on APEC to establish a special task force to identify infrastructure requirements in the region. The Pacific Business Forum was established by APEC to act as private sector consultants to the larger organization. The group is comprised of 36 members, one representative of big business and one representative of small to medium sized business from each of APEC's 18 member countries. Bill Mongelluzzo, "APEC Business Group Urges Quick Trade Liberalization," JOURNAL OF COMMERCE, September 6, 1995. ASEAN SETS DEADLINE FOR FREE TRADE ZONE Members of the Association of Southeast Asian Nations (ASEAN) have agreed on the year 2000 as the deadline for establishing a regional free trade zone, encompassing an area with a population of more than 400 million. ASEAN includes Brunei, Indonesia, the Philippines, Singapore, Malaysia, Thailand and, most recently, Vietnam. Singapore and Brunei have led efforts to speed up trade liberalization within the group because of what they see as the increasing challenge posed by the freeing up of world trade. Other countries within the group, most notably Vietnam and to a lesser extent Indonesia and Malaysia, say that if the pace of liberalization is too fast it could damage their economies. According to ASEAN statistics, intra-regional trade expanded by more than 40 percent between 1993 and 1994 to reach $44 billion. "Asean Hastens Trade Deadline," FINANCIAL TIMES, September 9/10, 1995. CEFTA WILL ADMIT SLOVENIA Last week, the members of the Central European Free Trade Agreement (CEFTA) -- Poland, Hungary, Slovakia and the Czech Republic -- agreed to expand the group to include Slovenia by December 31, 1995. Speaking at the CEFTA summit in Brno, Czech Republic, Czech prime minister Vaclav Klaus said he and his counterparts in the group had also agreed to further liberalize trade among their countries, remove barriers to capital flows, and form joint ventures in their countries' service sectors. He added that the premiers of all CEFTA members voted to include Romania and Bulgaria in the trade union and, perhaps later, Lithuania, Latvia and Estonia. A definite decision on the further expansion of CEFTA will come in August 1996, when the prime ministers meet again. To become a member of CEFTA, a country must have an association agreement with the European Union (EU), a free trade agreement with every other CEFTA country, and be a member of the World Trade Organization (WTO). "Central European Trade Group Will Admit Slovenia This Year," JOURNAL OF COMMERCE, September 15, 1995. ANDEAN NATIONS WILL JOIN SPECIAL U.S. TEXTILE PROGRAM Textile and apparel exporters from four South American countries will have greater access to the U.S. market beginning October 1, the date they are scheduled to join a U.S. program that their competitors in the Caribbean and Central America have been using for years. The so- called special access textile program allows exporting countries to negotiate more generous import quotas with the United States for goods sewn with U.S. fabric. Already in place for 24 nations from the Caribbean and Central America, the special access program will be extended next month to the four Andean nations of Colombia, Peru, Ecuador and Bolivia. The move builds on the U.S. government's 1991 decision to adopt the Andean Trade Preference Act, which gives preferential trade treatment to a wide range of other products from the four Latin Nations. At that time, the Bush administration, in an aggressive campaign to curb drug imports, viewed the preference act as a way to help the region break away from its dependence on coca, the crop used in cocaine production. All together, the four Andean nations exported more than $500 million in textiles to the United States last year. Right now, Bolivia, Peru and Ecuador are shipping small volumes of blouses, pants, yarns and other products to U.S. buyers and are under no quotas on the volume of imports. Paula L. Green, "Andean Nations to Join U.S. Special Access Textile Program," JOURNAL OF COMMERCE, September 13, 1995. __________________________________________ TRADE NEWS ROUND-UP __________________________________________ REPUBLICANS PUT OFF FAST-TRACK VOTE On September 14, Republican leaders in the U.S. House of Representatives postponed a vote on granting President Clinton authority to implement new trade agreements, amid signs that Democratic efforts to line up votes for the bill are faltering. The House Ways and Means Committee also put off action on two other controversial initiatives -- cutting back on a special program to assist workers displaced by imports, and another proposal to extend new trade benefits to Caribbean countries. In the case of the worker benefit program, the postponement was tied to the uncertainty over fast-track authority, which President Clinton will need to complete negotiations to add Chile to the North American Free Trade Agreement (NAFTA). Democrats unhappy with the Republican plan to cut the worker program say they might oppose new fast-track authority unless the program is restored. Republican leaders on the committee, who have already agreed to retain benefits for workers displaced by NAFTA, say they are willing to restore more funding, but only if Democrats can promise a large number of votes for the trade authority bill. The Caribbean bill, on the other hand, appears dead for the year, done in by the strong lobbying of apparel unions and especially underwear maker Fruit of the Loom. Ways and Means staff and Clinton administration officials will continue trying to work out the final language for the trade authority bill, but according to informed sources, the real work will involve lining up votes for it. Meetings are expected to last through this week. Meanwhile, the Senate Finance Committee has not begun to consider the new trade authority. Committee member Kent Conrad (D-ND) said last week that there was "no chance" of getting the authority approved this year. John Maggs, "House GOP Leaders Put Off Fast-Track Vote," JOURNAL OF COMMERCE, September 14, 1995. ___________________________________________ Trade News is produced by the Institute for Agriculture and Trade Policy, Mark Ritchie, President. Editor: Orin Kirshner. E-mail versions of Trade News are available free of charge for Econet/IATP Net subscribers. 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