With protectionist trade winds continuing to gather strength, the 90 countries that adhere to the General Agreement on Tariffs and Trade will meet here next Monday in an effort to bring about a new round of negotiations on world trade.
After months of maneuver and debate, the governments involved now appear to recognize that, if negotiations are not undertaken soon, the entire structure of liberalized trade rules built up under GATT over the past 35 years could be endangered by a wave of protectionism.
“There is no doubt that the mood has been changing rapidly in recent weeks,” a senior member of the American GATT team said. “We have been warning and warning against protectionist trends and the need to get a new round of negotiations going to help head it off. Well, now it’s here.
“Of course, it’s plain that simply starting a new round of talks isn’t going to solve America’s trade problem. But at least it might help us to hold the line--if it isn’t too late already.”
Arthur Dunkel, the Swiss director general of GATT, echoed these sentiments in an interview.
“The time has definitely come for a new major trade negotiation,” he said. “We need to reaffirm the credibility of GATT rules and reimpose them in areas that have slipped outside the realm of liberal trade. Otherwise, we will wake up one fine morning to find that GATT has passed into the history books.”
Next week’s GATT meeting will take up a familiar argument over the agenda for a new round of full-scale trade negotiations. If all goes well, it will produce an “outline agenda” that will be submitted to the annual meeting of trade ministers at the end of November.
The November meeting should then be able to call for a preparatory conference early in 1986, which could take up to a year to produce an agreement on a detailed proposal for negotiations.
The main obstacle at this stage is the question of how to include the so-called service sector in trade negotiations, along with agriculture, non-tariff barriers, subsidies, dumping, government procurement policies, trade in high technology and, of course, tariffs, although tariffs themselves are no longer regarded as a major factor in trade restraint.
India and Brazil have been in the forefront of an effort to omit the service sector from a new round of GATT negotiations. They see the move to include services as an effort by the major industrial nations to open up opportunities in the developing nations for their own banks, insurance companies and shipping and investment firms.
The developing countries have refused to deal with the service sector under GATT procedures, but they have inched forward to the point where Brazil has proposed that the subject be taken up in separate negotiations.
The U.S. position is that the service sector is relatively insignificant but that its inclusion is essential if the new round of negotiations is to have any real impact on maintaining the momentum of liberalization.
“The developing countries do not want to give in,” the American official said, “until they are sure of what they can get out of it through deals in other sectors--agriculture in particular.”
In the meantime, the European Economic Community has moved firmly to support the effort to get a preparatory conference under way. Japan has been solidly allied with the United States in the effort to push things along, and in recent weeks the other Pacific countries have moved in the same direction. That leaves India and Brazil increasingly isolated.
The United States is planning a low-key, wait-and-see approach to next week’s meeting. The theory is that too much pressure right now might be counterproductive, that it is better to allow the weight of other opinions to be felt.