THIRD WORLD DISSATISFIED WITH URUGUAY ROUND PROCESSES.

Sep 29, 1988

THIRD WORLD DISSATISFIED WITH URUGUAY ROUND PROCESSES.

GENEVA, SEPTEMBER 27 (IFDA/CHAKRAVARTHI RAGHAVAN)—Third world countries have generally expressed their dissatisfaction with the lack of balance in the negotiations on various issues on the agenda of the Uruguay round and have underscored the need for substantial progress at Montreal on issues of interest to them.

The trade negotiations committee (TNC), which has been entrusted by ministers at Punta del Este with the task of overall supervision of the Uruguay round MTNS, is due to meet at ministerial level in Montreal in the week of December 5 for a midterm review.

Third world dissatisfaction with the way the negotiating processes have been so far run, and the lack of progress in issues of concern to the third world, have been voiced in the debate on interdependence in the UNCTAD trade and development board.

At the march meeting of the board, the industrialised countries had been opposed to the Uruguay round issues figuring at this session of the board, but had reluctantly agreed as a compromise that the board, during its consideration of interdependence, would have an opportunity to follow closely the developments and issues in the Uruguay round of particular interest to the third world countries.

To facilitate the compromise, the secretariat had agreed not to produce any separate analytical and substantive report on the issues of the Uruguay round, apart from whatever was covered in the trade and development report.

The intention of the OECD group had been that with no separate secretariat analytical report, the entire issue would get diffused and there would be no focus to the third world efforts to debate the issues at this time.

However, the Group of 77 decided to put in its own document, and drew up a position paper, which has now been circulated as a board document.

This is the first time the group has been able to come up with a joint position on the Uruguay round issues.

Speaking in support of the G77 document, over a scare of third world countries, as well as china, either in separate statements or as part of their general statement, touched upon the Uruguay round issues in some detail, and specially in areas of priority to them, and expressed dissatisfaction with the outcome in the processes so far.

But in a concerted effort to avoid a dialogue at UNCTAD on the Uruguay round, the industrialised countries made no detailed comments, beyond claiming that the Uruguay round would be successful in tackling trade policy issues and in liberalising world trade.

However, Australia made a reference to the G77 document and underscored the need for progress in agriculture at Montreal, and the need for some early results in tropical products.

Speaking for the EEC member-states, Greece criticised the G77 for presenting the document, arguing that it was "not appropriate" for such a document to have been issued in view of the understanding on the treatment of the question at the board.

In a concerted effort to avoid a dialogue at UNCTAD on Uruguay round, the Group of 77 decided to put in its own document, arid drew up a position paper which has been circulated as a board document.

This is the first time the group has been able to come up with a joint position on the Uruguay round issues.

Speaking in support of the G77 document, over a score of third world countries who spoke in the debate in the board, either in separate statements or as part of their general statement, touched upon the Uruguay round issues in some detail, and specially areas of priority to them.

However, the industrialised countries made no detailed comments beyond claiming that the Uruguay round would be successful in tackling trade policy problems and in liberalising trade.

Australia however spoke underscoring the need for progress on agriculture at Montreal, and also the need for same early results in tropical products.

However, Hani Khalaf of Egypt, speaking for the G77, refuted the EEC criticism and said "the Group of 77 has acted within the letter and spirit of the consensus" reached in March on the treatment of the Uruguay round issues at the board.

"In exercising our right to express our viewpoint an these issues and developments on the Uruguay round, we are in practice, reaffirming our commitment to the final act of UNCTAD-VII which allocated the follow-up and issues in the Uruguay round to the trade and development board", Khalaf said.

Some third world sources noted that even if the industrial countries had refused to dialogue an the issue at the board, and had deliberately remained silent on the substance of the Uruguay round, the board's consideration has at least achieved the important purpose of enabling the third world to formulate a joint position which hopefully would be reflected in GATT and at Montreal too.

In individual comments on the Uruguay round issues, the Indian delegate, Amb. Kamalesh Sharitia, said that the G77 document illustrated the point made by the south commission in its statement in august in Mexico, namely that "developing countries share fundamental common interests and positions on the broad framework of the Uruguay round".

Sharma said that the central objective of developing a more open, viable and durable multilateral trading system which would liberalise and expand world trade for the benefit of all countries, and particularly third world countries, should not be lost sight of in the conduct and outcome of the negotiations.

Progress in the negotiations so far had not been according to expectations. Also, there had been non-implementation of the standstill and rollback commitments, with protectionism gaining "new strengthen and adherents".

To achieve a balance in pace and importance attached to the whole range of issues and negotiations, sincere efforts had to be made to advance negotiations in tropical products, textiles and safeguards.

Also, there should be strict adherence to the trips mandate, and there should be no "intrusion into the intellectual property protection regimes of developing countries, which are intrinsically instruments for encouraging indigenous scientific and technological capability, industrial advancement and economic development", the Indian delegate asserted.

Also, all concerned should live up to their undertaking at UNCTAD-VII not to make observance of multilaterally agreed commitments in respect of trade in goods conditional on receiving concessions in other areas.

Indonesia’s Syamsoeri Syarief, said negotiations in the areas of tropical products, agriculture, textiles, natural resource products and safeguards were of paramount importance to the third world. But after two years, progress in the 14 negotiating groups were "clearly uneven".

In tropical products, the Indonesian delegate complained, despite the "considerable negotiating activities" so far, there was no "common negotiating basis".

He blamed the lack of progress an attempts of industrialised countries to reinterpret the mandate and insist an "burden sharing and contributions by developing countries", to exclude of a number of tropical products from coverage, and link the negotiations to progress in agriculture.

In textiles and clothing, "negotiations have been marked by absence of political will an part of developed countries to formulate modalities that could permit the eventual integration of this sector into GATT".

Bangladesh’s Amb. Harun-Ur-Rashid, said the Uruguay round was qualitatively different from earlier GATT MTNS, and "is an attempt to regulate the world economy and economic relations for the 1990s and next century".

Progress so far had been purely "technical in nature", and there had been "no substantive progress in any of the 14 negotiating groups".

The Bangladesh delegate also stressed the need for favourable actions on the preliminary proposals submitted to various negotiating groups by Bangladesh on behalf of the least developed countries (LDCS) for concrete measures favouring the LDCS in any arrangements resulting from the Uruguay round.

Brazilian delegate, Amb. Rubens Ricupero, said heading as it was towards the mid-term review in December, the negotiations had so far failed to meet third world expectations for "balanced results".

Ricupero also expressed concern over violations of the standstill accord, and cited as a clear example of this the U.S. announcement about its intention to impose unilateral restrictive measures on selected Brazilian exports, purportedly for alleged insufficient protection for patents in pharmaceutical industry in Brazil.

The U.S. actions were not only a clear infringement of the standstill, but a measure for putting pressure an brazil to change its stance in the negotiating group on TRIPS.

"Such an attitude on the part of the U.S. casts a shadow an the whole atmosphere of negotiations in the round and illustrates the bilateral approach that seems to govern U.S. actions in trade relations and which is a cause of concern for all trading partners".

Yugoslavia’s Burislav Vukovic complained that not only had there been uneven progress, but "least progress" in areas of crucial interest to the third world.

For the Uruguay round to be a balanced process, reflecting the interests of all participants, there should be equal terms of negotiations in all negotiating areas and no area should be favoured at the expense of another.

The promotion of sustainable development of the third world should be fully observed and embodied in the results of the negotiations, and the differential and more favourable treatment for the third world, stipulated in the Punta del Este declaration, should be effectively implemented as an integral part of the results.

Multilateral disciplines in new areas, the Yugoslav delegate added, should be in the context of development and promotion of service industries in third world countries. Ending barriers to technology transfers, controlling the restrictive business practices of TNCS were important, as also full respect for policy objectives of national laws and regulations.

Tanzania’s Amb. Amir Jamal said the international community faced three broad optional scenarios:

The major industrial countries could increasingly enmesh themselves in a world of their own increasingly trading with each other, and with decreasing trade with the third world.

Or, they could increase their trade selectively with a number of third world countries to take care of industrial country growth requirements, leaving the rest of the third world to fend for itself.

Or, there could be a broad-based, long-term-oriented movement towards global interdependence, embracing all countries, large and small, rich and poor.

Jamal said the scenarios were no theoretical speculation, but based on facts.

On the one hand the relatively more advanced EEC states were contributing annually 40-50 BN ECU’s to the less-developed members of the community to promote structural adjustment.

On the other hand, the exports of manufactures from the 66 ACP countries to the EEC was stagnant at one percent of the EEC’s total imports.

In terms of value third world share of world exports had shrunk from 28 percent in 1980 to 19 percent in 1987.

Even making allowances for the particularities of the oil-exporting countries, in per capita terms the third world export performance ought to be a matter of international concern.

There was a direct co-relation between export performance and import capability, and if the industrialised countries were serious about expanding the markets for their goods and services, deliberate policy decisions were needed on their part in a number of areas:

--Channelling, on a sustained basis and in adequate quantities, resources for investment and related infrastructure,

--More committed attention to optimum management of the common fund,

--Encouragement to efforts of third world countries to promote the global system of trade preferences (GSTP), including through finance for inter GSTP trade,

--Balanced treatment in the Uruguay round, leaving sufficient breathing space for third world countries to achieve levels of internal capital formation, which alone would make them reliable, long-term, profitably trading partners.