After Toronto, trade ministers pave way for future negotiations. US to brief presidential candidates to maintain trade talk momentum

As foreign trade ministers from Japan, the European Community, and Canada arrived at this lakeside resort town, United States trade negotiators gave them extra large sweatshirts, emblazoned ``THINK BIG.'' The idea behind the shirts was to work on building momentum in trade negotiations following the Toronto economic summit, which ended last week. Although the shirts were symbolic, the importance of such trade discussions was underscored at a press conference Friday when US trade representative Clayton Yeutter said his office would brief the presidential candidates following the two-day Minnesota meeting.

The candidates have historically been briefed on other issues such as national security and foreign policy, but never before on trade.

Mr. Yeutter said his office would contact the campaigns of Gov. Michael Dukakis and Vice-President George Bush to insure ``as smooth a transition as possible'' between administrations. The US even went so far as to videotape most of the meetings here so the next trade team will have an idea of how to host such get-togethers.

The importance of this transition was made clear to the US at the Toronto summit when France reportedly suggested delaying some trade discussions until after the November presidential election. And the negotiators have now decided to hold a short, post-election meeting of the four trade partners so the transition team can get up to speed on the issues.

What the candidates will find is that there are substantial disagreements over some key trade issues. At Brainerd, the US and its three largest trading partners tried and failed to develop a consensus on such trade issues as agricultural subsidies, access to markets, safeguarding local industries from import surges, and the settlement of trade disputes. In fact, the trade ministers did not even formally take up the controversial subsidies issue since they remain at odds on the subject.

But they did get closer to final positions in such areas as patents, services, investment policy, and ways to improve the implementation of the General Agreement of Tariffs and Trade (GATT), the multilateral trade treaty.

In terms of services, for example, the group agreed in principle that such areas as telecommunications, data processing, and legal and accounting professions should be covered by GATT. Yeutter says it is possible that changes to improve GATT in these areas might be made shortly and implemented on a provisional basis. The ministers also agreed that trade issues involving third-world countries should be settled on a case-by-case basis instead of generally giving such countries blanket special trade treatment.

By themselves, these issues would be important, but they have greater impact given the fact that US exports now represent 30 percent of the growth of the US economy. Debate on these issues is taking place when the US is considering two important trade bills: a newly revived Omnibus Trade bill, which recently passed the House, and the Canadian Free Trade Agreement, soon to be debated by the full Senate.

Many of these trade issues will also be discussed by a still larger forum in Montreal starting Dec. 5, when the 96 members of the GATT meet to review the progress they have made in the current round of trade talks, which are taking place in Geneva.

Thus the Brainerd meeting, nicknamed ``a quadrilateral'' for the four participants, was considered a warm-up for the Montreal review.

The trade ministers met for a few hours each day to sort out the direction they wanted their staffs to go. But the informal setting of a rustic lodge allowed for some high-level trade jibes. For example, hearing the story of a Hibbing, Minn., company that is selling chopsticks to Japan, Yeutter told Japanese trade minister Hajime Tamura, ``If a Minnesota firm can sell chopsticks in Japan, Californians ought to be able to sell rice easily.'' Japan bans the importation of rice.

After receiving a Minnesota Twins baseball cap as a gift, Mr. Tamura pointed out that the cap was made in China. ``If it were made in Minnesota,'' he countered, ``it would help your trade deficit.''

But generally the trade ministers made serious progress, Yeutter said. ``We thought big, most of the time.''