International Trade Daily | September 10, 2001
BRUGGE, Belgium--The French government warned the 14 other European Union member states and the European Commission Sept. 7 that there was a need for a back-up strategy as way to ease economic and political fallout from a possible failure to launch a new World Trade Organization trade round in Qatar in November.
The warning from the French came when EU trade ministers, meeting here for a one-day summit, agreed to stick to the basic outlines of a comprehensive mandate for the launch of a new World Trade Organization trade round in Qatar that it adopted two years ago in Seattle. The EU slightly amended that comprehensive approach by offering nations the chance to opt out of investment and competition negotiations.
While the overwhelming majority of EU member states expressed optimism that the rest of the world, including the United States and most developing countries, were ready to heed the EU's comprehensive trade approach, France had another viewpoint.
Francois Huvart, the French junior trade minister, said developing countries were likely to reject a new trade round and therefore a delay of one year should be considered.
Indicating that an all-or-nothing approach to a comprehensive round could fail in Qatar, French officials also called on other EU member states to consider a strategy on how to deal with another collapse. The French suggested that the WTO could highlight the accession of China into the WTO and offer transitional periods for tariff liberalization in products such as textiles for developing countries.
No Give on Scope of Talks
Huvart also made it clear to his fellow EU trade ministers that France was insistent that the entire EU negotiating mandate, which involves a wide range of issues, including agriculture, competition, anti-dumping, environment, investment and intellectual property rights, had to be accepted in full.
"France made it clear that there should be no give and take to the EU mandate and that if the comprehensive round does not succeed there should be a back up strategy," said a Swedish trade official, who spoke on the condition of anonymity.
The same Swedish official also acknowledged that if the overall EU mandate is not accepted in Qatar, "we don't have a strategy for that situation. It is not clear yet how we will deal with that situation."
Huvart told a press briefing open only to French journalists that if the Qatar meeting fails, it will likely be a result of developing countries vetoing a new trade round.
Concern About Farm Subsidies
The warning raised by France was seen also as signal to the Commission, which will lead the EU negotiating efforts in Qatar, that it will not allow any concessions in the field of agriculture. Before Seattle the Commission acknowledged that one of the benefits of a comprehensive round approach was that it would give the EU more bargaining chips when facing the inevitable demands by competing agriculture exporting countries that EU farm export subsidies be eliminated.
"As the largest recipient of funds for the EU Common Agriculture Policy, France is worried that it has the most to lose in Qatar," said a Commission official. "When you combine that with the fact that French elections will take place next year and the French Socialist Green Party coalition government wants to avoid being seen as a proponent of globalization, you can understand why the French are suddenly trying to raise doubts about Qatar."
Concerning the issue of agriculture, Trade Commissioner Pascal Lamy rejected the possibility of the EU agreeing to the elimination of agriculture export subsidies. The CAIRNS group of 18 agriculture exporting countries, which includes Brazil, Argentina, New Zealand, Canada and Australia, recently reiterated a pre-Seattle demand that the EU eliminate all agriculture export subsidies.
"The EU has increased market access and has reduced production supports over the last decade," Lamy said. "But when it comes to the reduction of export subsidies, there is no quantity identified."
Speaking on controversial issues such as anti-dumping and competition, Lamy said the United States was now much favorable to including both issues in an agreement to launch of new WTO round.
"The issue of anti-dumping is a deal breaker for many WTO members," said Lamy. "... the U.S. seems to appreciate much more the benefits of having some fundamental discipline (when it comes to anti-dumping rules).
Copyright c 2001 by The Bureau of National Affairs, Inc., Washington D.C.International Trade Daily:
