US urges drive for Gatt accord

Click to follow
The Independent Online
THE US is set to revive prospects for a successful conclusion to the General Agreement on Tariffs and Trade talks, aiming for a breakthrough by the Tokyo World Economic Summit next month.

Top US officials plan to use this week's annual meeting of the Organisation for Economic Co-operation and Development in Paris to persuade a broad group of industrial countries to support the drive for a Gatt accord.

To underline the importance it attaches to securing support for a final push, Washington is sending six cabinet secretaries, led by Lloyd Bentsen, the Treasury Secretary, and Mickey Kantor, the trade representative.

But the two-day talks, which start tomorrow, could be marred by escalating trade tensions between Tokyo and Washington. The US has been talking up the Japanese yen to deal with its deepening trade deficit with Japan, and has also hinted that it will demand new measures from Japan to open up its markets, beyond those already promised by Tokyo.

On Saturday, Asahi Shimbun, the Japanese newspaper, claimed to have obtained a draft of the communique to be released at the meeting. It urges Japan to stimulate demand to cut its huge global trade surplus and cautions the US against managed trade. Both issues are likely to prove highly controversial.

Nevertheless, trade ministers from the 24 OECD member countries are to hold talks during the OECD meeting with the aim of broadening support for a market access agreement, following a meeting of ministers from the key quadrilateral group - the US, the EC, Japan and Canada.

Further meetings are planned in the run-up to the Tokyo summit, from 7 to 9 July, where President Clinton is anxious to achieve a breakthrough. That would permit him to submit a Gatt package to the US Congress by 15 December. Mr Clinton's 'fast-track' authority to ask Congress to approve the Uruguay round on a simple 'yes' or 'no' basis will expire after that date.

Hopes are riding on the increasing likelihood that the US-EC agreement on reducing agricultural subsidies will hold. Despite misgivings that France could undermine the farm trade deal, last week's EC agreement to boost financial support for French farmers is expected to placate the French government.

Developing countries are threatening to challenge the nomination of Peter Sutherland, the former EC competition commissioner, to replace Arthur Dunkel as director general of Gatt, writes Gail Counsell.

Mr Sutherland, a 47-year old Irishman, and chairman of Allied Irish Banks, has the support of the EC and the US. But some developing countries feel that the giant trading blocs have assumed that his appointment is a foregone conclusion.

The organisation has called a special session on 9 June to appoint a head to replace Mr Dunkel, who will step down at the end of this month.