Oct 18, 1991


GENEVA, OCTOBER 17 (CHAKRAVARTHI RAGHAVAN) – Despite the "deadlines" set and pressures sought to be put by GATT Director-General Arthur Dunkel for concluding the negotiations, there have been few signs so far of earnestness or "flexibility" on the part of negotiators to narrow differences, according to participants.

Consultations have resumed in the several negotiating groups on Agriculture, Textiles, Trade-related Intellectual Property Rights and services, after a week’s break necessitated by the Telecom show in Geneva (and Dunkel's trip to Bangkok for the Fund/Bank meetings).What little "flexibility" has been shown has been on the side of the Third World countries, with the ICs continuing to be demanders and not yielding anywhere, one participant said.

However, several Third World participants said this is all too early in the game.

While remaining sceptic of the very large number of areas of differences being resolved over the next couple of weeks (according to the Dunkel deadlines), as also of new support for the negotiations purportedly coming out of the Bangkok Fund/Bank meetings and of Finance Ministers, Third World sources were bracing themselves for considerable pressures on them.

No Finance Minister or Head of the State for that matter is going to tell Dunkel or anyone else that they are not for success in the Round or against liberalisation, one participant noted.

Others said that it was a strange situation that the major financial institutions and Finance Ministers of the rich and poor countries who have been unable to resolve the major problems of the financial system or their own finances, are now trying to shift the responsibility and burden on the trading system and the negotiations as if some miracles would happen to resolve the financial situations of the indebted countries through the Round.

In Agriculture, the consultations Wednesday at the GATT would appear to have centered on the issue of problems of net food importing Third World countries - who are anxious to continue to get food aid and or access to cheaper imports.

As against this the exporting countries, particularly of the Third World, want to make sure that provisions for food aid are misused by the major exporters from the North, using the food aid to bypass the disciplines that might emerge on export subsidies.

On the wider issues of cuts in farm subsidies – domestic support, border protection, and export subsidy - participants said in any event no change in EC would be know until next week's meeting of the EC Council of Agriculture Ministers in Brussels.

There has been considerable speculation about the German position, particularly because of reports in the British press on what Chancellor Kohl purportedly told his cabinet, and the contradictory reports of it as given out by Economy Minister Jurgeh Mollemann and Agriculture Minister Ignaz Kiechle.

But some non-official German sources note that the two over a period of time have been known to be openly feuding in public and the German position or moves would have to be seen in the wider context of German interests, which they note include the major German problems in agriculture in the former eastern Germany, and Germany's interest in ensuring that the benefits of any agriculture liberalisation go to helping eastern Europe.

The sources suggest that there is an element of surrealism in the official GATT view of an imminent breakthrough because of purported change of German position and break with the French.

Reflecting a somewhat different view (than that in the English media), Germany's leading financial paper, Handelsbatt of Dusseldorf, reported Monday that the reports of the split in the German-French axis (on agriculture) and the breakthrough in the GATT talks had not impressed anyone.

The report suggested that any concession by the EC in agriculture would be in return for major concessions by the U.S. in many other areas - services; changes in the subsidies code to exempt not only agriculture including putting into the "green box" entire direct payments to farmers, but subsidies and support in other areas like aircraft industry, space industries, the steel sector and assistance for regional structural adjustments and programmes.

The EC would also expect concessions by the U.S. and others in other areas including the problems of rules of origin, geographical appellations and other major differences on intellectual property issues (including first to invent or first to file), etc.

In the Textiles consultations, participants said, there has been no sign of flexibility on the part of the importing countries over the major demands of the exporters, despite repeated appeals by Dunkel, who chairs the consultations, that it was necessary to send the right signals to industry in the North about the phasing out of the protection.

One of the major points being pressed by the exporting Third World countries is for more credible provisions about integration and phasing out of MFA restrictions and liberalisation of imports and trade.

For this, they have said the annex to the agreement, listing the products that would be phased out over the transition period, should contain only the products actually under restraint and not all textile and clothing products, and those not under restraint should be immediately integrated into the GATT disciplines.

The EC and the U.S. have been opposed to this, arguing that while some products covered by the MFA might not be under restraint now, the transition arrangements must enable them to impose restrictions if needed, and they could not agree to do this by using the normal GATT procedures.

In the TRIPs consultations, the group of Andean countries put forward a proposal in the form of amendments to the draft text which showed some movement by them towards the viewpoints of the industrialised countries, but in others suggested a firmer stand.

In the actual discussions, relating to copyrights and computer software, the exchange of views in the informal consultations did not show any change in the position of the parties, and the chairman, Lars Anell of Sweden, reportedly adjourned the consultations for more reflection by everyone.

One of the, issues in computer software protection is whether it should enjoy both copyright and patent protections (as the U.S. wants) or only copyright protection, and whether it should be as "works" under the Berne convention (with a 20-year protection) or as "literary works", enjoying much longer period including after the author’s demise.

The Andean text made clear for example that the computer programmes would only enjoy protection of the Berne convention and as "works" (and not literary works).Discussions in TRIPs are to resume thursday.