GATT Officials Press for Breakthrough in Trade Talks

WITH political deadlines and a slowing world economy pressing down on them, agriculture trade negotiators for the United States and the European Community are locked in intense talks in Geneva that will determine the outcome of international trade liberalization negotiations."The next few days will determine whether there is going to be an accord or not" in the five-year-old Uruguay Round of trade talks, said one EC official close to the negotiations on Wednesday. Official talks, including the agriculture discussions and bilateral meetings aimed at breaking down remaining areas of disagreement, are expected to continue today. "The best thing and most we can say is that true negotiations are taking place," said an official yesterday from the General Agreement on Tariffs and Trade (GATT), which is sponsoring the negotiations. US President Bush and EC officials including President Jacques Delors sketched the outlines of a compromise on farm trade earlier this month. This would allow negotiations in the Uruguay Round of world trade talks to draw to a close, perhaps by the end of this month. Officials at the deputy minister and undersecretary level - the highest level of negotiators to meet since the Bush-Delors talks - have since been working to translate a general compromise into specifics. "It's now up to the negotiators to see if they can give concrete meaning to the broad indicators set forth at the highest levels," says one US official in Geneva. "Hopes have been raised over the past couple of weeks, but if these meetings don't bring the US and the EC closer to a political deal, then we have a real problem." The US has reduced its demands for cutting trade-distorting farm subsidies, saying it now will accept a 30 to 35 percent cut over five or six years. That's down from the 75 to 90 percent in cuts over 10 years it was holding out for a year ago. For its part, the EC now agrees to make commitments for reducing export subsidies and internal supports, and improving market access for foreign investors. But remaining problems include the dates to be used for calculating required subsidy reductions, the details in establishing tariffs, safeguards against sudden import rises, and EC insistence on implementing tariffs on currently duty-free products from the US to offset other concessions. Officials on both sides say the issue of effective dates for subsidy cuts on permitted exports are not petty: They could mean the difference of several million tons. The ambitious Uruguay Round of talks, which involve 108 countries, aim to bring such sectors as services, intellectual property, textiles, and agriculture under the jurisdiction of GATT for the first time. But it is agriculture that brought negotiations to a halt a year ago, and which still threatens to wreck plans for rules to carry the world trading system into the next century. Prospects for agreement in the talks, now in nonstop debate, appear to brighten one day and dim the next, based on statements from key players. Earlier this month GATT Director-General Arthur Dunkel called November "our best available window of opportunity" for successfully concluding the talks, given the US presidential election next year and the EC's building concentration on its single market. Calling for a "final sprint," he said negotiations should be wrapped up by the end of November. Other GATT officials say that would mean a target for signing the final accords next March or April. Some officials from key trading countries continue to talk tough about the possibility for agreement in the Uruguay Round. South Korean officials refuse any opening to imports in their rice market. And French Agriculture Minister Louis Mermaz continues to warn his EC colleagues, who must approve any EC agreements, of "American intransigence." But others, perhaps with an eye on slowed world trade growth, are signaling a readiness for the crucial compromise moves on which the Uruguay Round still depends. Japan's Prime Minister Kiichi Miyazawa has uttered veiled indications that Japan will eventually open its sacrosanct rice market. In commenting on his talks with Mr. Bush, Mr. Delors said the breakthrough over agriculture should send "a strong message to the world economy" that prospects for accords boosting world trade and economic growth were considerably brighter.