Inside US Trade | Vol. 19, No. 21
U.S. Trade Representative Robert Zoellick has signaled to the European Union and other trading partners that he favors a limited number of items that could be added to the built-in agenda of agriculture and services negotiations for a new round in the World Trade Organization. He said that he wants to add market access, transparency in government procurement procedures and clarifications of the dispute settlement process, according to informed sources.
Zoellick has argued that such a narrow agenda is in tune with what developing countries will be able to back, but did not formally reject any additional topics in last week's meetings held in Geneva and in the margins of the Organization for Economic Cooperation & Development, officials said. "He is trying to sound open [to other topics], while at the same time trying to narrow the agenda," one official said.
The EU and Japan both favor broader negotiating agendas for a new round. But EU officials this week concede that Zoellick indicated a lack of interest in the topics the EU is advocating for the agenda, such as investment and competition. At the same time, one EU official insisted, Zoellick did not completely rule out these EU agenda items. "Nobody is laying down any specific markers," he said.
Earlier this month, a U.S. official told an informal WTO General Council session that the U.S. can see a negotiating agenda of industrial tariffs, trade facilitation, transparency in government procurement and a ministerial decision revitalizing work on electronic commerce. The official also signaled that the U.S. is prepared to listen to other suggestions for a negotiating agenda (Inside U.S. Trade, May 18, p. 1).
In his Geneva meetings, Zoellick also highlighted the need to reach out to developing countries on the agenda and not to define it solely among major trading partners. He mentioned the need to bring on board such countries as Mexico, South Africa and Singapore, sources said. In his bilateral meeting with EU Trade Commissioner Pascal Lamy, Zoellick signaled he is ready to begin an active dialogue on the WTO negotiations, but not with the EU exclusively, officials said.
But Zoellick gave little indication on how he would respond to key demands by developing countries that existing trade agreements be implemented in a way that would give them more benefits. In Geneva, Zoellick indicated in at least one meeting that he was personally looking at implementation issues, one official said.
Zoellick also said he has begun to discuss that issue with EU trade commissioner Pascal Lamy based on a list he has under consideration, sources said. Lamy raised this issue in a Quad meeting bringing together Zoellick, and the trade ministers of Canada and Japan in Paris, where they failed to agree on a common response to countries' requests for an extension of the Jan. 1, 2000 deadline for implementing the Agreement on Trade-Related Investment Measures, officials said. The U.S. has taken a tough line in talks on TRIMS extensions.
Zoellick was clear both in meetings with Lamy and Geneva ambassadors of WTO members that a declaration at the ministerial would have to be short and concise but at the same time broad enough to allow the agenda to be expanded to new subjects at a later date, sources said.
He delivered the same message in a May 15 press conference in Strasbourg where he said he favored a ministerial declaration that is "shorter, perhaps more general" than the declaration trade ministers tried to develop unsuccessfully in Seattle. Such an alternative would be patterned after the declaration that launched the Uruguay Round in Punta del Este, which left room for various interpretations, and avoided the difficulties of Seattle, Zoellick said.
Separately, EU Agriculture Commissioner Franz Fischler also indicated that a ministerial declaration needs to be general and balanced between agriculture and other agenda items. The agriculture text of the declaration cannot be more specific and detailed in terms of negotiating goals than the language on the other issues, Fischler said in a May 18 press conference in Washington, DC. For agriculture text, Fischler said he sees the "content" of Article 20 in the Agriculture Agreement plus a timeline for the completion of the negotiations. This would be very controversial with the Cairns Group, whose representatives have said in Geneva that they want a detailed declaration for agriculture if any new topics are added to the agenda.
EU officials insisted this week that they are awaiting a clear signal from the U.S. regarding the scope of a potential new WTO round, possibly in advance of a bilateral summit on June 14. The two sides could identify agenda items that they both want to pursue, leaving aside the areas of disagreement, officials said.
Some EU officials insist that they are still hoping to have a substantive statement on areas of common interest that goes beyond a general endorsement of a new round at that time, but others concede that is unlikely.
One source insisted that he was "not at all pessimistic" that the two sides could reach agreement on "areas of common interest" by the bilateral summit.
A USTR official this week expressed doubts that a detailed U.S.-EU statement could be developed over the next three weeks. "I would not want to set any deadline," said USTR chief of staff M. B. Oglesby after a speech to the Chamber of Commerce. "But I would suggest [June 14] is probably a little early."
Failure to issue such a statement would raise further doubts that a consensus on a new round can emerge by the fall beyond a very limited agenda, sources said. The WTO ministerial will take place in Qatar from Nov. 9 to 13, but the WTO director general and other key members want to have an early decision to avoid the last-minute negotiations that led to the failure of the 1999 WTO ministerial in Seattle.
Oglesby said that officials are "now getting serious and looking at what needs to be put together" in a new round. He pointed out that Zoellick had met with 25 to 30 ambassadors during a trip to Geneva last week and followed up on the phone with South American officials.
In his meeting with Lamy, Zoellick clearly indicated that he was now turning to the issue of multilateral negotiations as his priority, compared to his previous focus on the Free Trade Area of the Americas, officials said. There were also indications that he was gaining more familiarity with the issues that are part of the debate over a new round, officials said.
In his meeting with Lamy, Zoellick said he was working to prevent an extension of U.S. wheat gluten quotas, an issue that the U.S. will have to decide by this month. The wheat gluten discussion came about as part of reviewing bilateral trade disputes, which also included the foreign sales corporation dispute (see related story).
In his May 15 press conference, Zoellick said he wants to obtain additional information about the nature of the government financing provided for a new Airbus jumbo jet to the member states' governments. The EU information provided earlier this month is "still a little bit general" and the U.S. wants to get more information about the financing terms as a next step, Zoellick said.
Zoellick said the time had come to see Airbus and Boeing not as respective national standard bearers of the aerospace industries but rather as Euro-Atlantic companies that have substantial operations in each other's markets. He said he has examined the numbers of Airbus employment in the United States, and they are "quite significant."
The issues the U.S. is raising are not related to the nationality of the respective companies, but rather to the subsidies for which there are international rules, Zoellick said.
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