Dec 21, 1985

PREPARATORY COMMITTEE ON NEW ROUND SET FOR JANUARY 27-29.

GENEVA, DECEMBER 19 (IFDA/CHAKRAVARTHI RAGHAVAN)— The first meeting of the Preparatory Committee on a new round of Multilateral Trade Negotiations (MTNs) is set for January 27 for a three-day session, it was announced here by the GATT secretariat.-

The announcement came after an informal meeting of delegations on Wednesday, chaired by the GATT director-general, Arthur Dunkel, who will also chair the Preparatory Committee.-

Subsequent sessions of the committee are expected to be held every three or four weeks, with 2-3 days of meetings each time, to be devoted to specific issues agreed upon in advance, to enable delegations to come prepared.-

The formal first meeting will be preceded by an informal one on January 21.-

The Preparatory Committee was set up by the GATT Contracting Parties at their session ending november 28, "to determine the objectives, subject matter, modalities for and participation in the Multilateral Trade Negotiations (MTNs), taking into account the elements of the 1982 Ministerial work programme and the views expressed in the group of senior officials".-

The Committee has been asked to prepare by mid-July, "recommendations for the programme of negotiations for adoption at a Ministerial meeting to be held in September 1986".-

According to participants at Wednesday’s informal meeting, the differing perceptions and divisions between the Industrial and Third World countries, and even within the Industrial countries, were very much in evidence.-

This appeared to indicate that the decisions of the CPs' session had been no more than a procedural one, and serious issues of substance had merely been papered over.-

There appeared to be differences in the priorities, and even whether there should be priorities, the end objectives of the Preparatory Committee, and how to go about it.-

There was the view, put forward by Argentina and Egypt, that the Committee should proceed on the basis of, and work towards, a consensus.-

There was also the view of the U.S., which seemed to be taking a m ore formalistic view of the Committee's work, as merely a procedural hump to be crossed, to enable the Ministers to launch a new round, irrespective of the outcome in the Committee.-

The U.S. would appear to have underscored more the Committee's mandate to prepare recommendations by mid-July rather than its substantive mandate of determining "the objectives, modalities for and participation in the MTNs".-

In the same way, the U.S. also was of the view that the mandate nowhere called for an agreed report from the Committee, and it could merely be a "chairman's report".-

The U.S. view presumably was in the light of its experience in the "senior officials' group", established by the special session of the GATT CPs on October 2, which was unable to agree on any report due to sharp differences.-

Two secretariat drafts, which appeared to lean towards the U.S. view on MTNs, were rejected, and ultimately the chairman of the group (Felipe Jaramillo of Colombia) presented a very short procedural oral report, along with the minutes of the meetings.-

As a result, it became clear that far from opposition to the U.S. moves coming from a handful of Third World countries, the concerns over the undue emphasis to and priorities for new themes while relegating substantial issues of GATT competence to the background, were very widely shared.-

According to some participants, it was clear that some of the protagonists of a new MTN, like the U.S., were trying to prevent a similar situation, as in the senior officials' group, in the Preparatory Committee.-

Some of the Industrial countries like the U.S. are against any verbatim records or minutes for the Preparatory Committee (unlike in the case of the senior officials' group), while Brazil and some others argued that at the moment "every option has to be kept open".-

Earlier, Dunkel reportedly had said that he was proceeding on the basis there would be no minutes or verbatim records, and that it would be an "exploratory and clarificatory" report, whose purpose would be to enable Ministers to have the background on the draft recommendations.-

Canada, which has been often taking a stand supportive of the U.S., would however appear to have taken a more conciliatory position, stressing the need to approach the work in a manner that would help bring "everyone along".-

For some delegations, Canada agreed, a report might have more value than for others. Neither on the nature of the report, nor on questions of priorities and other issues, should positions taken now that might prejudice the final outcome.-

The differences, some participants said, were not merely on such procedural issues and the formats about the final outcome, but even on some issues about the priorities for the Committee' s work.-

Some Third World delegations explained later that even the emphasis laid by the U.S. on the "recommendations" by mid-July, and its not needing support or approval of the Committee, would make the exercise lop-sided.-

As one delegate put it, before any recommendations could be made, one had to agree on the objectives of the MTNs, the issues or subjects to be covered, as well as the modalities and participants.-

Also, they noted, the decision to set up the Preparatory Committee was tied to the chairman's clarificatory statement (a negotiated document), after adoption.-

This had said that "questions of standstill and rollback, treatment of developing countries and safeguards should constitute important issues for the work of the Preparatory Committee".-

Third World countries, like Brazil, have already put forward proposals for "legally binding" commitments by individual Contracting Parties at their highest levels on "standstill" on protectionism, to be notified before any agreement to launch a new round.-

They have also called for a time-bound programme of "rollback" of protectionist measures kept in place by industrial countries, either in violation of their GATT obligations or maintained outside the GATT framework (such as through voluntary export restraints and other "grey area" measures).-

They have also said that a comprehensive understanding on safeguards should be negotiated and agreed upon as the first item in a new MTN, before moving to negotiations on to others.-

These countries had sought to have decisions on this at the November meeting, even prior to the setting up of a Preparatory Committee, but agreed in a spirit of compromise to the issues being considered as a matter of priority and importance in the Preparatory Committee.-

Australia and New Zealand, similarly, want the Preparatory Committee to decide on the coverage of issues in the negotiations as well as the priorities within them, and to prepare a negotiating mandate.-

By this, they want to ensure high priority for trade in agriculture.-

The United States, while not contesting the priorities set in the chairman's understanding, seems to feel that it has other priorities (presumably "services") which should be addressed.-

But the U.S. seemed willing to have the issues of "standstill" and "rollback", addressed in the first meeting of the Preparatory Committee, but looking at the "substance" of the issues and not merely in form.-

The European Communities on the other hand view the MTNs as "a single, global one" - meaning presumably that the entire package of issues would have to be negotiated, agreed upon, and implemented as a package.-

There have been suspicions among third world countries, and also temperate agricultural producers (like Australia and New Zealand), that the entire EEC ploy of strong support to U.S. on "services", is aimed at using this, and by insisting on a package to prevent serious inroads into its common agricultural policy.-

At Thursday’s informal meeting, the EEC would appear to have objected to "priorities", by arguing "everything is a priority".-

Also, in the EEC view, the Preparatory Committee was only "a pre-negotiating stage", to enable Ministers to decide on launching a new round, and thus not a "negotiating stage" where issues of substance could be tackled.-

According to some participants, since some of the delegations had no instructions, perhaps most of the issues would have to be discussed again at the informal meeting in January.-

Among the issues that would need early decisions, Dunkel would appear to have indicated, were the questions of venue and dates for the Ministerial meeting in September.-

So far there are offers to host the meeting from the European Communities (at Brussels), from South Korea (at Seoul), Uruguay and Canada.-