A GATT PROCESS WITHOUT 'GREEN ROOM'?

7:19 AM Jul 27, 1993

A GATT PROCESS WITHOUT 'GREEN ROOM'?
Geneva 27 July (Chakravarthi Raghavan) -- Negotiators in the Uruguay Round are due to break for the summer recess Wednesday and resume for intense negotiations on market access in goods and services from 13 September and a mid-October target for completing them.

Negotiations on other issues, including questions about changes to the 'Dunkel text' (the draft Final Act agreement texts tabled by then GATT head, Arthur Dunkel in December 1991), are likely to be considered or taken up only at that time -- with the process for this still unsettled.

The bilaterals and plurilaterals on market access in goods and initial commitments in services, since the Tokyo G7 summit and resumption of the process at the GATT, have been merely going through the motions and repetition of known positions, several Third World sources said.

The socalled Quad 'market access' package, in the light of the clarifications and details provided by the Quad countries last Thursday, show that there is little or nothing in them for the developing countries.

In none of the sectors targeted by the Quad for 'zero tariff' or harmonisation at very low levels, are Third World countries even 'major' suppliers (those having atleast ten percent share in import market).

At best, in or two product lines in the sectors identified or identifiable, one or another Third World country may have a supplier interest, but not broad enough for any sectoral concessions.

Nevertheless, they are asked to 'reciprocate' on sectors and 'match' what the Quad have offered, but without the Quad willing to make any meaningful offers in export lines of interest to the developing world.

At Punta del Este, and the earlier run-up to the launching of the Uruguay Round, as well as in much of the trade policy neo-classical literature since then, the developing countries have been told to open up their economies and accept the rules and disciplines in new areas (intellectual property, investments and services), for the alleged benefit of the increased market access openings that will be provided to them in areas of export interest to them.

In the current round of negotiations, little of the latter appears to have been so far evident.

It would appear that the kind of legal doctrines and arguments that developing countries used to make about 'unequal treaties' and treaties that have lost their validity because of altered circumstances are now being put on their head by the industrial world which is trying to go back on its own commitments and demand more from the South.

In the bilaterals, according to some of the participants, the US and EC have called upon developing countries to provide their own market access concessions, making clear that in the 'altered circumstances' since Punta del Este -- of rising unemployment and economic crisis in the industrial world, it would not be possible for the industrial countries to provide more market openings whether in agriculture, textiles and clothing or footwear and other export product lines of interest to the developing world.

On present plans, sources said the entire Uruguay Round negotiations would need to be completed atleast by the third week of November, giving just a week or two to take care of 'slippages' and wrapping up the final package to meet the US fast-track authority deadlines.

A series of meetings this week of the Group of Negotiations on Services (GNS), a smaller group of negotiators on agriculture and the Group of Negotiations on Goods (GNG) (which is dealing with the market access in goods) appear to have tentatively agreed on such a work programme of intensified bilateral negotiations and plurilaterals beginning September.

The Trade Negotiations Committee is due to meet on 28 July when the GATT Director-General and TNC Chairman, Peter Sutherland is expected to outline his ideas on the programme and how he plans to go about the business of holding consultations.

Reflecting the new style, and perhaps reflecting too a new kind of imperial condominium in the trade area, several Third World sources suggest that under the guise of increasing transparency and bringing all issues before the TNC, Sutherland may now be set on a path that will reduce the effective circle of consultations and decision-making in the GATT, and place real decision-making in the hands of the US and European Community, and then perhaps the Quad.

Sources gave this assessment on the basis of second and third hand information filtering to them out of stray conversations that Sutherland and some of his aides have had with a delegation or two, and the interviews (on record and on background) that Sutherland has been giving.

Some key delegations say they have not been consulted or contacted on the process and would wait and see.

Those who have not been involved in the 'green room' or other processes, in a sense are happy that the old methods may be given up, but are not sure that the new ones will be more transparent or work in their favour either.

One of them noted that the earlier consultation processes had evolved as the GATT membership expanded and it proved difficult to establish or declare on a consensus on the basis of the US-EC bilateral accords.

This was what led to the CG-18 (Consultative Group of 18) which for a time was a regular body whose constitution used to be announced at the annual meeting of CONTRACTING PARTIES. The CG-18 used to be convened by the GATT D.G. for consultations, but without any decision-making power.

The 'Green Room' process too began with a similar membership and was gradually expanded during the Uruguay Round process, and gradually was convened for 'transparency' before formal TNC meetings. The more restricted 'Rossin group' was convened by Arthur Dunkel (Sutherland's predecessor) in end 1992 to consider the changes to his draft text for the Uruguay Round package.

Sutherland is reported to have been telling some that all these have become rigid and he wants to have less formalised procedures, and would convene consultation groups, with membership depending on the issues, which would imply the presence as constants of the US, EC and perhaps Japan, and others as variables.

Gamani Corea, former Secretary-General of the UN Conference on Trade and Development, used to say that the group of system of negotiations in UNCTAD was cumbersome and time-consuming, with many problems and defects, but that it was the only alternative to the unworkable process of negotiations with the entire membership.

But the UNCTAD process of group negotiations had the merit of the groups choosing their representatives and spokesmen and those representatives having to gain consent of their group to establish the consensus.

In the GATT, the majors and the GATT leadership in the 1980s frowned upon any notion of North-South used to speak of GATT having only individual contracting parties and their interests and hence only individual negotiations, with attempts to promote issue-based groups like that of the Cairns (with all such groups led by an industrialized country member and its wider OECD interests).

But the GATT system attempted negotiations in a small circle, except that the GATT DG called in representatives he chose (but in fact settled by the US, EC and other power brokers) for the negotiations, with the circle expanding gradually on the basis of those who, if kept out, would create problems.

Any one-to-one consultations that Dunkel might hold, or in issue-based selective convened by him and with members decided by him, would be even less transparent than now.

At the first TNC, Sutherland called for 'group' statements rather than individual interventions, but how he sees the 'groups' was not made clear, either for the 'statements and interventions' or for the negotiating processes.

How the Sutherland process will work out, and with what success, remains to be seen. But as one observer put it, it may be easier for a country to say 'no' at a TNC or a GATT Council than when called in for consultations in any 'green', 'dunkel' (which in German means dark) or other consultations.

But it would break down when those outside the process say 'no' and withhold consensus in the TNC process, some of them note.

And in the final analysis the head of the GATT is only a 'contracted party' and will remain so even in the new MTO while agreements have to be negotiated and concluded among contracting parties, governments of countries, for whom the trade stakes are increasingly high.