Nov 9, 1985

JAPAN TO CONTINUE "SOME PROTECTION" ON LEATHER IMPORTS.

GENEVA, NOVEMBER 7 (IFDA/CHAKRAVARTHI RAGHAVAN)-- Japan will continue to provide "some protection" to its domestic producers of leather and leather products, but will do so through tariffs and not Quota Restrictions (QRs) or other non-tariff barriers.-

This was reported to have been indicated by the Japanese delegate at the meetings of the GATT Council, which ended Wednesday.-

The Council, which held its last meeting before the annual meeting of the GATT Contracting Parties, mainly considered the various report s of subordinate bodies considering individual items on the GATT work programme, and passed them on to the annual session of the GATT CPs for their consideration.-

But apart from this, a number of pending disputes were also discussed and among them the implementation by Japan of a panel ruling against it calling for elimination of QRs on Japanese imports of leather and leather products.-

Japan had told earlier meetings of the GATT Council that it was taking action to eliminate the QRs, and liberalising imports, but that it would take some time.-

The U.S., the principal complainant against Japan, as well as a number of Third World countries, have been repeatedly bringing this issue up before the Council, and pressing for faster Japanese actions.-

On Wednesday, Japan would appear to have advised the GATT Council that it had now notified the GATT secretariat of its intention to eliminate the QRs on many of the remaining items and replace them with tariff measures, and its readiness to enter into consultations, in terms of article XXVIII of GATT, for modification of its existing tariff schedules.-

A country wishing to modify its tariff, is required under article XXVIII to hold consultations with the Contracting Party (CP) with which it negotiated the tariff on these products, and also with the other principal suppliers to its market.-

Japan is reportedly holding consultations on the issue with the U.S.-

A major concern of the other countries, particularly the Third World countries, is that Japan would be negotiating a bilateral deal with the U.S., and leave out the others, holding no more than pro forma consultations with them.-

Uruguay and Argentina sought from Japan clarifications on what kind of tariffs it would se imposing, what kind of tariff lines would be covered, and whether the process of negotiating tariffs would be used to further delay the implementation of the panel report.-

Argentina and Uruguay clearly wanted to be involved in the consultations being held by Japan, and they were supported by India, New Zealand, Australia and a number of other countries, who also evinced interest in consultations.-

The Japanese delegate would appear to have explained that Japan would follow general GATT rules, and that it would complete its consultations and change over to tariffs, as soon as possible.-

The Japanese delegate would also appear to have explained that it was not the intention to replace the existing "illegal" barriers by "legal" tariff barriers.-

Japan would like to reduce the barriers, but would need to maintain some protection for its domestic producers.-

Two other past panel reports involving long running disputes between U.S. and EEC were also discussed, but without the Council being any nearer to a solution.-

The disputes related to canned peaches and other canned fruits (where the U.S. complains of EEC subsidies) and EEC imports of citrus fruits (where the U.S. complains of EEC preferences to Mediterranean countries adversely affecting U.S. exports).-

The EEC had been unwilling to implement the panel recommendations, and in effect has blocked adoption of the panel reports.-