France bargains to the end in Gatt talks

EUROPE and the United States wrestled through last night to draw up a draft Gatt agreement liberalising world trade, as France raised the stakes by warning it would accept nothing agreed so far. But the Belgian Foreign Minister, Willy Claes, whose country holds the EU presidency, said the chances of a deal were 'more than 50-50'.

The Farm Commissioner, Rene Steichen, was also optimistic, saying that the US Trade Representative, Mickey Kantor, and his European counterpart, Sir Leon Brittan, hoped to get an agreement by this morning.

Although the parties seemed to have made tangible progress over key differences on agriculture, the French Foreign Minister, Alain Juppe, denied there was a farm accord, or enough progress in other areas to constitute a breakthrough.

'At the moment the conditions for a deal have not yet been met. We are not the only delegation to believe there can be no deal as things stand.' He cited agriculture, the creation of an organisation to police world trade, improved market access and problems in the audiovisual sector as the main obstacles to the drafting of a blueprint that was to have been presented to European foreign ministers for discussion yesterday.

Instead, Mr Kantor and Sir Leon worked through the night to find solutions to present to foreign ministers this morning, delaying the Geneva timetable by at least a day. 'I know the timing (to meet the 15 December deadline) will be tight, but it is not our fault,' Mr Juppe said.

Today's discussions will not be easy. France has linked agriculture to a host of other demands designed as insurance against any losses resulting from a Gatt accord. Paris wants the European Union to devise stronger trade weapons against the US, and to promise that if French farmers are required to limit agricultural production further, cuts will be achieved by lowering prices rather than letting more farmland lie fallow. This will not sit well with Germany's uncompetitive farm lobby, which depends on price subsidies.

According to details released yesterday, the reworked agricultural deal answers many of France's original complaints by enabling the EU to unload much of its grain mountain cheaply on the world market, and to delay the effect of any cuts - a key French demand. Diplomats suggested that the French position amounted to political brinkmanship rather than a principled stand.

With the political stakes mounting, all countries are fighting for the greatest commercial gain at the lowest political cost. As befits a deal seven years in the making, the endgame will involve the subtle resolution of interlinked negotiating positions. Mr Juppe said: 'As we have always insisted, nothing is done until everything is done.'