Inside US Trade | March 16, 2001
In his meeting with European Union Trade Commissioner Pascal Lamy last week, U.S. Trade Representative Robert Zoellick signaled that the U.S. is open to considering the establishment of multilateral rules governing investment and competition in the context of new World Trade Organization negotiations. However, informed sources said Zoellick was not yet able to discuss the more divisive issue of whether WTO rules on anti-dumping and subsidies should be on the negotiating table.
Zoellick also told Lamy that the Bush Administration is unlikely to be in a position to say by July whether it will be able to support a new WTO round, which echoes a comment he made to WTO Director General Michael Moore in February.
Despite Zoellick's indication that investment and competition could become negotiating topics in any new round, his thoughts had not yet filtered through to staff-level officials that met with their Quad counterparts just before the March 9 Lamy-Zoellick meeting. These staff-level officials said that the U.S. does not yet have a position on investment, which echoes U.S. staff comments in Geneva, where Japan is leading an informal process on exploring elements of WTO investment rules.
On investment, Zoellick expressed concern with Lamy that minimum investment rules that may be developed in the WTO could undermine the strong rules the U.S. has negotiated in bilateral investment treaties (BITs) with various countries, sources said.
One official said the EU responded that WTO rules could allow for the stronger disciplines of BITs, much as trade rules now allow for regional agreements that deepen liberalization.
Sources added that it was clear that the topic of competition rules was a new issue for Zoellick, and that the EU considered his statement on this matter as his initial thoughts.
In the Zoellick-Lamy meeting, both discussed the importance of addressing labor rights, with Lamy suggesting a stronger role for the International Labor Organization in trade related issues, officials said. That role could include having the ILO certify countries' compliance with conditions set up in trade preference programs, such as the Generalized System Preferences, according to these sources.
Zoellick also mentioned the possibility of deepening U.S. and EU cooperation in such areas as services, given that the Transatlantic market place is already being created by companies, officials said. He also signaled a willingness to put more political effort behind breaking the current deadlock on existing a mutual recognition agreements (MRA) on electrical safety and pharmaceuticals, they said.
The two sides also discussed the need to address developing countries' demands for better implementation of existing trade agreements to achieve more trade benefits. Sources said that on this issue, Lamy urged more U.S. flexibility. More generally, Geneva trade officials have long pointed out that one way of dealing with these demands is to give developing countries some changes as a downpayment to secure their support for a new round and address some of their remaining problems in new negotiations.
In his meeting with Lamy, Zoellick responded that it was difficult to address these implementation demands because it would amount to going back on existing trade agreements as a way of moving forward on a new round, sources said. Zoellick expressed a preference for rolling these developing country demands into new negotiations by saying it is difficult to go backwards before going forward, one official said.
But in the meeting, Zoellick signaled that he considered helpful in building new support among developing countries for a new round an effort to make available drugs that fight HIV/AIDs to countries that cannot afford them, officials said.
These sources said Zoellick advocated fast action on the drug initiative, partially because it would help developing countries without weakening the Agreement on Trade-Related Intellectual Property Protection, sources said. But Zoellick also highlighted the HIV/AIDs initiative as a part of a "positive agenda" on which the U.S. and EU could cooperate and build trust, officials said. Zoellick also welcomed the EU's "Everything but Arms" initiative as a way to build support for international trade among developing countries, officials said.
Other items on this positive agenda are the accession of Russia and China into the WTO, they said.
In a joint press conference on March 9, Lamy emphasized the importance of a positive agenda as a way to build the trust in the new round and help ease the "inevitable frictions" and bilateral trade disputes that will occur between them. Zoellick used the press conference to speak in favor of more openness and transparency in the WTO as a way of building support for trade.
In the press conference, Zoellick also announced his willingness to take a new U.S. look at the EU's proposal on a negotiating agenda. "As I review the U.S. positions, I am sincerely interested in looking at the full range of ideas the EU has to see whether we have areas where we can cooperate or at least accommodate or in some way adjust," he said. But he said he had to discuss such issues with members of Congress and various interest groups.
"[T]his is an opportunity for a new administration to take a fresh look at some of these issues and see where we can move ahead."Inside US Trade:
