URUGUAY ROUND WOULD HAVE SOME NEGATIVE EFFECTS IN AFRICA

6:09 AM Sep 15, 1993

URUGUAY ROUND WOULD HAVE SOME NEGATIVE EFFECTS IN AFRICA
Geneva 15 Sep (TWN) -- "An early conclusion of the Uruguay Round negotiations, which received a fillip from the July Tokyo Summit", is absolutely essential, UNCTAD Secretary-General Kenneth Dadzie said here in releasing the 1993 Trade and Development Report.

But the conclusion of the Round would not bring any immediate benefits to the countries of Sub-Saharan Africa and could even have some negative implications because of erosion of preferences enjoyed by them through the Lome Convention and the GSP schemes, UNCTAD's Director of the Trade Policy Programmes, Vijay Kelkar told newsmen in response to questions.

He was replying to questions whether the very bleak prospects facing the countries of the Sub-Saharan Africa would be countered or relieved by a successful conclusion of the Uruguay Round and its promises of trade liberalization.

Kelkar pointed to the uncertainties surrounding the finalization of the various draft agreements in the Dunkel text of the Draft Final Act and the pending negotiations on market access, and suggested any views about the effects could at best be speculative.

However, he suggested, that Sub-Saharan Africa would gain by better trading rules through security of market access and. hopefully, increased market access.

"But on market access unfortunately, there would be medium to short-term negative implications because of the erosion of preferences in the Lome agreement and the Generalized Scheme of Preferences. There would also be negative effects for net food importing countries and many of them would be facing higher food prices."

Kelkar was then asked about the increasing criticism from organizations in Third World countries about the negative effects and harm to developing countries as a result of the Uruguay Round accords and whether UNCTAD still believed on balance a successful conclusion would in fact benefit the Third World and the industrialized countries.

The UNCTAD official noted that the present DFA text was still incomplete and there was no full information available on market access questions. Until the entire picture was clear, it would be difficult for anyone or for the Third World countries to make an assessment whether the overall package would be acceptable or in their interests.

But the security provided by disciplines and clear trade rules would be in their interests, Kelkar suggested.

Dadzie was then asked whether there was not a contradiction between UNCTAD's traditional thinking on trade and challenge to conventional thinking on macro-economic policy. He was asked about the TDR support for conclusion of the Round would benefit investment and trade of the developing countries. Other recent assessments, including a study by the UN Centre on TNCs, it was noted had brought out that patent protection or its absence had not influenced foreign investments and that the TRIPs agreement calling for uniform global standards (and monopoly over imports) in patents and other intellectual property coupled with liberalization of trade and reduction of import barriers, would in fact reduce the industrialization scope in developing world and increase for example prices of medicines and other pharmaceutical products.

Dadzie suggested there was a misunderstanding. It had been noted that developing countries had accepted the DFA as a basis for negotiations to conclude the Round, not that everyone should accept it. The developing countries had made clear that they could not judge the acceptability of the DFA as a whole until a number of points were clarified, including market access and other issues of vital interest to them.

Trade: Negotiators wait on US-EC power ploys

Geneva 15 Sep (Chakravarthi Raghavan) -- Trade negotiators in Geneva, particularly from the Third World, are bracing themselves for a further period of going through the motions -- but with their major trading partners, particularly Europe and the United States, not engaging in real negotiations -- and waiting on the EC and the United States to find a way out of the French objections to the agriculture deal.

While the Cairns group agricultural exporters and others generally have been encouraged by the US refusal to renegotiate the Blair House accord, and reduce even further the possible future gains to others out of the Uruguay Round, there is little illusion that without compromises or the French backing down, the Round can be concluded by the 15 December deadline.

The agricultural tangle in a sense is back in the EC court, and the meeting of the 'Grand Conseil' (jumbo meeting of the EC ministers of foreign affairs, trade and agriculture on 20 September) and how they will find a way to accommodate French objections and get the negotiations in Geneva moving forward.

Like the French objections to the Blair House agriculture deal, the latest objection voiced by Paris to the liberalization of the EC and French market to US Hollywood films (to be shown in cinema houses and on TV) is not new and is an unresolved issue in the services area and the concessions to be made by the EC.

But unlike in the case of 'trade in goods', where the EC Commission has jurisdiction under the Rome treaty (with France having to exercise the rarely-used veto on grounds of 'vital national interest' within the EC Council of Ministers), the EC Rome treaty gives the Community no mandate on services.

As France has repeatedly made clear, without any challenge by the EC Commission, the services agreement in the Uruguay Round (GATS) and any accords negotiated by the Commission would need the consent of all the member-states to be effective and, unless an MTO comes into force, the contracting parties would be individual member-States.

The issue of audio-visual services and exceptions is one of the outstanding issues in the services area.

In the GATS negotiations, before and after the 1990 Brussels failure in the Uruguay Round, the US had been wanting maritime services to be total and completely excepted (which France, EC, Norway and others have been steadfastly opposing).

Similarly, the EC and France have been trying to get audio-visual services excepted or provided with a derogation or exception to the most-favoured-nation treatment rule on grounds of culture.

The Dunkel draft, where the previous GATT Director-General supplied some compromises in areas of disagreement, has provided for the general application of the MFN principle, with some scope for any Party to provide for exception by listing it specifically in its schedule of commitments, and subjecting any exceptions of more five years to a multilateral review. The Dunkel compromise provided for periodic review, but not specific multilateral approval or time-bound wavers.

This in theory would mean like the waiver granted to the US over agriculture in the 1950s, it could be reviewed but could go on and on.

This particular compromise though is still to be accepted -- with the US having an interest in securing exceptions for maritime services and the French for cultural services and, perhaps, each hoping for some compromise deal at the end.

But the net result of the current situation, some Third World sources said, is that we would all be negotiating in uncertainty and, almost to the wire, the US and EC would make a deal and try to force others to accept it -- pointing to the 15 December deadline and the dangers to the conclusion of the Round if others tried to get changes made or to reopen other issues.

This would be a strategy and tactics similar to that adopted by the US and EC in the final stages of the Tokyo Round, and one that GATT Director-General Peter Sutherland (as their joint nominee) might try to push and further.

But whether it would work is not very clear. If it did, the Third World will lose even more than now.