New Trade Chiefs In EC and US Spark Hopes for GATT

By , Staff writer of The Christian Science Monitor

WITH the world economy continuing to lumber under a stubborn slowdown, international trade officials are hoping the arrival of new hands on the political controls in both Washington and Brussels will steer the Uruguay Round of international trade talks toward rapid conclusion.

Just this week Sir Leon Brittan, the European Community's new trade commissioner, said he would undertake beginning next week a series of high-level meetings - including, he hoped, talks with newly appointed United States trade representative Mickey Kantor - to break open the 108-nation trade negotiations.

"Every week we don't have an agreement costs the world dear in money and jobs," said Sir Leon in Brussels, the EC administrative headquarters.

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Now all eyes are fixed on Washington to see what kind of initiatives will come out of the Clinton administration. "What people are looking for is this new blood - Brittan and Clinton and his people - to inject some renewed energy into this last stretch" of the talks, says one senior trade source close to the negotiations. "Right now the ball is in Washington's court; we're looking for signals."

The six-year-old Uruguay Round of negotiations, under the auspices of the General Agreement on Tariffs and Trade (GATT), is designed to extend international trade rules to such new areas as agriculture, textiles, services, and intellectual property.

The round has repeatedly stalled over US-EC trade differences since high-level talks collapsed in December 1990 over agriculture. The US and EC finally reached agreement on the extremely sensitive farm chapter of the negotiations last November, but efforts to wrap up the round with the Bush administration failed.

Now some observers doubt further progress can be made before March elections in France, where the Socialist government attacked the US-EC farm accord as too favorable to the US. But March is also the date by which the talks would need to conclude in order to get an agreement passed by the US Congress before the administration's negotiating mandate runs out in June.

Some officials involved in the GATT talks are placing hopes for the round on an extension of the Clinton administration's mandate. But sources close to the negotiations are worried that an extension would open the door for interests in the US who want to see the round extended to such issues as trade's impact on the environment and on competition policy.

The atmosphere surrounding the talks was somewhat troubled by comments from Mr. Kantor at his Senate confirmation hearings this week. The California attorney voiced "concern" about certain aspects of the agriculture deal.

The stalled Uruguay Round and slowed world economy has encouraged protectionist thinking in some quarters, while adding volume to cries from other to conclude the round as a means of boosting economic growth.

"It is clear that a successful conclusion of the round would give - both for psychological and economic reasons - a much needed boost to the world economy," said Lars Anell, Sweden's ambassador to the EC and participant in Uruguay Round negotiations, speaking at a recent GATT general session. "In fact," he added, "it is one of the few decisions governments can take without economic risks in order to stimulate the world economy, since fiscal expansion is ruled out because of levels of debts and public def icits already being too high."

GATT officials note that expansion in world trade continued to slow in 1992. The European Community, which only in December forecasted EC growth for 1993 between 1 and 1.5 percent, has already revised the estimate down to .8 percent.

Yet a growing number of international economic players are questioning full faith in the free-trade philosophy on which GATT's trade-liberalization negotiations are based. Observers note that a new generation of economists, more interested in national industrial policies and an aggressive international economic policy, has arrived in Washington with President Clinton.

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