UK encouraged by Washington trade talks

WASHINGTON - Easing fears of an impending trade war between Europe and the United States, John Major ended his two-day visit to Washington yesterday expressing confidence that the Clinton administration was committed to free trade and concluding the stalled Gatt negotiations, writes David Usborne.

Differences on trade issues had threatened to cloud Mr Major's first meeting with President Bill Clinton and members of his cabinet, including the new US Trade Represenative, Mickey Kantor. But the mood instead seemed to have been one of reassurance rather than of belligerance.

'Things are honestly looking much better than what I had feared when we first came out,' one senior Downing Street source commented, noting in particular that discussions with Mr Kantor had gone well.

Even so, officials acknowledged that two specific disputes that have erupted since the administration took office - over steel imports and access to America's telecommunication's market - are still to be resolved. Sharp US sanctions over the telecommunications row are still due to come into effect on 22 March.

The optimism seemed to be based particularly on attitudes towards finishing the long-delayed Uruguay Round of the Gatt negotiations. Remarking on his discussion on the matter with the Mr Clinton, Mr Major said: 'I'm in no doubt whatsoever that he is committed to an early agreement in the Uruguay Round.'

More specifically, Mr Major seems to have been given some verbal assurance that Washington will not, as it has previously hinted, attempt to unravel important agreements already struck in the drive towards an overall Gatt deal. There has been particular anxiety over the fate of the EC-US truce reached last year in Washington over farm subsidies.

'I don't believe that that agreement will be reopened,' the Prime Minister said. He added, however: 'Reaching a final deal is going to be painful for everyone.'

Nor was there any direct clash between the leaders over European subsidies to the aircraft consortium Airbus.