TRADE WEEK 1-21-94

[Kai Mander <kmander@xxxxxxxxxxx>]

TRADE WEEK Volume 3 Number 3
Friday, January 21, 1994
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Headline:
URUGUAY ROUND SCHEDULE DISCUSSED
GATT CRITICIZES EU BANANA BARRIERS
G-3 SIGNING DELAYED
MERCOSUR COMMITMENTS REAFFIRMED; CET REMAINS ELUSIVE
U.S., CHINA SIGN TEXTILE AGREEMENT
MALAYSIA WANTS TO HURRY AFTA TIMETABLE
RESOURCES
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GATT News Summary
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URUGUAY ROUND SCHEDULE DISCUSSED

GATT Director General Peter Sutherland met with members of the
European Commission Monday, including Trade Commissioner Leon
Brittan and Farm Commissioner Rene Steichen, to discuss wrapping
up the Uruguay Round text by April 15, 1994.  "The discussions were
largely to do with tying up the remaining loose strings following the
December 15 agreement on the minimum that the final deal will
contain," said a Commission spokesperson.  The talks reportedly
focused on improved market access, EU import restrictions on Chilean
apples, the EU-Latin American banana dispute, EU and U.S. pressure
on Japan to make further tariff reductions, and the new World Trade
Organization.  "But it was not a negotiating meeting.  We are not
negotiating with Sutherland," the spokesperson said.  "Both sides are
simply keeping each other informed of their actions."  Sutherland
also restated his position that any new tariff reduction or market
access offers must be made by February 15.

Sources: "GATT's Sutherland Meets EU's Brittan on Trade Issues,"
REUTER, January 17, 1994; "Sutherland, Brittan Discuss Uruguay
Round Steps," REUTER, January 18, 1994.
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GATT CRITICIZES EU BANANA BARRIERS

A GATT panel report condemning the EU trade barriers against Latin
American bananas was released January 18, following the failure of
EU attempts to convince Latin American countries to withdraw their
backing from the report.  The report was issued in response to a
complaint launched by several Latin American countries July 1,
1993, when the EU instituted a new tariff and quota regime on
bananas that gave preferential treatment to former European
colonies in Africa, the Caribbean and the Pacific (the ACP countries).
The regime was designed to maintain market access commitments to
the ACP countries under the Lome Convention, and met resistance
from countries in the EU that were not party to the Convention.  The
GATT panel report, which is unlikely to be adopted, said the Lome
Convention could not be defended against general GATT principles as
a free trade agreement or a customs union.

Sources:  Stephanie Nebehay, "Latin Americans Win GATT Ruling on
Banana Quota," REUTER, January 18, 1994; David Dodwell, "GATT
Condemns EU Over Bananas," FINANCIAL TIMES, January 19, 1994.
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Other Trade News
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G-3 SIGNING DELAYED

Plans to sign a free trade agreement between Mexico, Colombia and
Venezuela (the Group of Three; G-3) this week have been postponed
until after February 2, when Venezuelan President-elect Rafael
Caldera takes office.  Mexican President Carlos Salinas de Gortari
reportedly requested the delay because of the current armed
uprising in the state of Chiapas.  Caldera is not expected to seek
changes in the accord, which will eliminate tariffs on most goods over
the next 10 years.

Source: "G-3 Pact Delayed Until After February 2," REUTER, January
19, 1994.
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MERCOSUR COMMITMENTS REAFFIRMED; CET REMAINS ELUSIVE

Argentina, Brazil, Paraguay and Uruguay signed a joint declaration
January 17 reaffirming their commitment to establishing the
Southern Common Market (Mercosur), set to go into effect January 1,
1995.  The countries failed, however, to conclude talks on forming a
common external tariff (CET).  The CET and macro-economic policy
harmonization have been major stumbling blocks in the integration
process, leading Paraguayan President Juan Carlos Wasmosy to argue
that, "The timetables set in the (Mercosur's founding 1991) Act of
Asuncion are extremely tight, which makes it necessary to establish
more reasonable deadlines."  Agreement has been reached for
common tariffs on 85% of the goods on their customs list.  The
remaining 15% include capital goods, information products and
chemicals.  In principle, common tariffs for these goods is to be set
by the year 2001.  A solution is impeded by Brazil's desire for high
tariffs to protect its ability to produce the controversial goods, while
its partners want lower cost access to goods that will help them
develop other industries.

Sources: Esteban Israel, "Mercosur Deadline Too Tight, Paraguay Tells
Summit," REUTER, January 17, 1994; "Brasil Obtem Adiamento No
Mercosul," PROJETO CRONOLOGIA - IBASE, January 18, 1994; "Tariff
Accord Hits a Snag," NEW YORK TIMES, January 17, 1994.
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U.S., CHINA SIGN TEXTILE AGREEMENT

The United States and China struck a textile quota agreement in
Beijing Monday that effectively freezes Chinese imports to the U.S. at
present levels.  Under the pact, China agreed to limit exports to the
United States and to accept U.S. proposed penalties and fines for any
violation of the deal.  The last minute agreement averted a trade
row, which the U.S. had threatened to initiate over alleged Chinese
trans-shipments, overshipments and false labeling of textile exports.
U.S. officials estimate that the value of trans-shipments of Chinese
textiles routed through third countries exceeds $2 billion annually.
U.S. Trade Representative Mickey Kantor welcomed the pact calling it
"the beginning of a healthier and more productive relationship"
between the U.S. and China.  The China National Textile Council said
last week during negotiations that the quota reduction would hurt
hundreds of companies, force some into bankruptcy and eliminate up
to 300,000 jobs.

Sources: Tony Walker, Simon Holberton, Nancy Dunne, "Last-Minute
Textile Deal Freezes U.S. Imports From China," FINANCIAL TIMES,
January 18, 1994; "U.S. and China Reach Agreement on Textile
Imports," MINNEAPOLIS STAR & TRIBUNE, January 18, 1994; "China
Says U.S. Quota Cut Threatens 300,000 Jobs," REUTER, January 11,
1994.
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MALAYSIA WANTS TO HURRY AFTA TIMETABLE

Malaysian Trade Minister Rafidah Aziz called on Southeast Asian
nations Tuesday to agree to shorten the 15-year timetable for
implementing the Asean Free Trade Area (AFTA) and to widen the
trade area's scope.  Under AFTA, members of the Southeast Asian
Nations (ASEAN) agreed to cut tariffs on manufactured and processed
goods to a maximum of five percent over 15 years from 1993.  "We
are thinking of reducing the timeframe of 15 years to say 10 years,"
Rafidah told reporters at the end of a four-day visit to Manila.  "If we
can make those tariff cuts faster, why not?"  She said the Philippines,
Singapore and Brunei reacted favorably to the proposal, but did not
comment on whether other ASEAN members, Thailand and
Indonesia, would support it.

Rafidah also warned that Malaysia would oppose any attempts to
formalize the Asia-Pacific Economic Cooperation (APEC) forum
because it could weaken the ASEAN structure.  "We don't want
ASEAN to be diluted," she said.  "The moment APEC is
institutionalized, ASEAN will be submerged."  APEC was initially
formed by Australia, Brunei, Canada, China, Hong Kong, Indonesia,
Japan, Malaysia, Mexico, New Zealand, Papua New Guinea, the
Philippines, South Korea, Singapore, Taiwan, Thailand and the United
States to act as a loose consultative forum, according to Rafidah.  She
said Malaysia does not want to turn APEC into "another
Commonwealth" or an organization similar to the European Union.

Sources: "Malaysia Urges Shorter Timeframe for AFTA," REUTER,
January 18, 1994; "Malaysia Opposes Formal Structure For APEC,"
REUTER, January 17, 1994.
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Recent Publications on International Trade
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"GATT And India: The Politics of Agriculture," Devinder Sharma,
KONARK PUBLISHERS PVT LTD, 1994.  188 pages.  A-149, Main Vikas
Marg, Delhi, India, 110092.  $25.00.

"NAFTA'S Bizarre Bazaar: The Deal Making That Bought Congressional
Votes On The North American Free Trade Agreement," PUBLIC
CITIZEN, December, 1993.  76 pages.  215 Pennsylvania Avenue SE,
Washington, D.C. 20003.  (202) 546-4996.  Fax: (202) 547-7392.
$10.00.

"Dislocated Workers : Trade Adjustment Assistance Program Flawed,"
GENERAL ACCOUNTING OFFICE, GAO/T-HRD-94-4, October 19, 1993.
8 pages.  P.O. Box 6015, Gaithersburg, MD 20884-6015.  (202) 512-
6000.  Fax: (301)258-4066.  First copy free.

"The Challenge of Cross-Border Environmentalism: The U.S.-Mexico
Case," Tom Barry, RESOURCE CENTER PRESS, No. 1 in U.S.-Mexico
Series, 1994.  118 pages.  Box 4506, Albuquerque, NM 87196.  (505)
842-8288.  Fax: (505) 246-1601.  $9.95.

"On Foreign Soil: Government Programs in U.S.-Mexico Relations,"
Beth Sims, RESOURCE CENTER PRESS, No. 2 in U.S.-Mexico Series, 1994.
84 pages.  Box 4506, Albuquerque, NM 87196.  (505) 842-8288.  Fax:
(505) 246-1601.  $9.95.

"Crossing The Line: Immigrants, Economic Integration, And Drug
Enforcement On The U.S.-Mexico Border," Tom Barry, RESOURCE
CENTER PRESS, No. 3 in U.S.-Mexico Series, 1994.  142 pages.  Box
4506, Albuquerque, NM 87196.  (505) 842-8288.  Fax: (505) 246-
1601.  $9.95.

"For Richer, For Poorer: Shaping U.S.-Mexican Integration," Harry
Browne, RESOURCE CENTER PRESS, No. 4 in U.S.-Mexico Series, 1994.
115 pages.  Box 4506, Albuquerque, NM 87196.  (505) 842-8288.
Fax: (505) 246-1601.  $9.95.

"Mexico Through the Tortilla Curtain," THE NEW INTERNATIONALIST,
No. 251, January, 1994.  36 pages.  P.O. Box 1143, Lewiston, NY
14092.  (905) 946-0407.  Fax: (905) 946-0410.  One year
subscription: $42.00.
The NEW INTERNATIONALIST magazine reports on the issues of
world poverty and inequality.  This month's issue focuses in depth on
Mexico and includes articles on cross border integration.

"The Final Act of the Uruguay Round - Press Summary," NEWS OF
THE URUGUAY ROUND, NUR 080, December 14, 1993. 32 pages.
Information and Media Relations Division, Centre William Rappard,
154, rue de Lausanee, CH-1211, Geneva 21 Switzerland.  (41-22)
739-51-11.  Contact organization for prices.

"Chiapas Digest," INSTITUTE FOR AGRICULTURE & TRADE POLICY,
Volume 1, No. 1, January, 1994.  5 pages.  1313 5th Street SE, Suite
303, Minneapolis, MN 55414-1546.  (612) 379-5980.  Fax: (612)
379-5982. E-Mail: e-mail hholm@xxxxxxxxxxx
IATP is temporarily producing this weekly bulletin which includes
news, analysis and declarations on the peasant uprising in Chiapas,
Mexico.
_____________________________________________________________
Editors: Gigi DiGiacomo and Hannah Holm
The Institute for Agriculture and Trade Policy (IATP)
1313 Fifth Street SE, Suite #303, Minneapolis, MN 55414-1546 USA
Telephone:(612)379-5980 Fax:(612)379-5982 E-
Mail:kmander@xxxxxxxxxxx
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