Ministers from the US, Japan, the EC and Canada said they were within sight of a General Agreement on Tariffs and Trade accord after a meeting that took place on the fringe of the OECD ministerial talks. 'We concluded that it is now realistic to aim for the outline of an ambitious market access agreement by the Tokyo summit (next month),' said Sir Leon Brittan, the EC's chief trade negotiator.
But as one cloud lifted over world trade another hove into sight yesterday as the European Community agreed to impose tit-for- tat sanctions on about dollars 15m ( pounds 9.7m) worth of US business. The tariffs, which will require formal approval next week by EC foreign ministers, were widely expected and will hit mainly US suppliers of telecommunications and construction equipment to Europe.
They are in retaliation against similar sanctions imposed by Washington. These took effect on Friday and are the result of the long-simmering row over the award of government contracts.
At the OECD talks themselves, finance ministers pointed to the need for a Gatt accord as they drew the gloomy conclusion that room for monetary and fiscal stimulus to promote recovery was running out. Lloyd Bentsen, the US Treasury Secretary, suggested the chances for a Tokyo agreement were good.
'I think what we are going to see is not a change overnight, but we will work out an agreement that will advance the expansion of trade around the world,' he declared.
Mr Bentsen also stepped up pressure on Germany and Japan to boost the flagging world economy. While recent cuts in interest rates should help, 'further substantial reductions are prudent', he said.
His comments reflected growing frustration among ministers at the apparent pause in German interest rate cuts. On Japan, Mr Bentsen said '(It) has both the means and the need to increase domestic demand and reduce its external (trade) surplus.'
Meanwhile, the OECD forecast that joblessness in its 24 member countries could reach 36 million this year. The EC Commission yesterday warned that European unemployment would continue to mount until the EC economy managed to grow by 3 to 3.5 per cent a year - a goal unlikely to be reached before 1995 at the earliest.Reuse content