U.S., Europe Fail Again to Achieve Farm Trade Deal

U.S. and European Community negotiators reached another impasse over farm trade Friday, as the head of the world’s trading system issued his own version of an international trade agreement in an effort to rescue the foundering 5-year-old negotiations.

EC Agriculture Commissioner Ray MacSharry, emerging from the latest in a series of meetings here with U.S. Agriculture Secretary Edward R. Madigan, said the two sides remained deadlocked over the U.S. demand that the EC dismantle its system of massive subsidies to farmers.

Negotiations involving 108 nations have been bogged down over that issue for more than a year. To try to nudge the talks along, Arthur Dunkel, director general of the Geneva-based General Agreement on Tariffs and Trade, prepared a 500-page draft of what final agreements might look like in agriculture and the 14 other negotiating areas.

U.S. negotiators, while reserving final judgment until they have time to analyze the complex package, reacted without enthusiasm to Dunkel’s document. U.S. Trade Representative Carla Anderson Hills noted that it merely represented Dunkel’s own attempt “to resolve many highly contentious issues.”

Said Hills: “Despite his extraordinary efforts, he was regrettably unable to secure a consensus among participants on all issues. . . . Moreover, nothing in this draft is agreed until everything is agreed.

“We will continue to be guided,” Hills added ominously, “by our strong belief that no agreement is better than a bad agreement.”

Hills was in Brussels to link up with Madigan and Secretary of State James A. Baker III for today’s semiannual conference between top U.S. and EC officials. The trade talks are likely to dominate that meeting.

Separately, Hills met Friday with Frans Andriessen, the EC’s top trade negotiator, but spokesmen for both sides said the session was for exchanging information, not for negotiating.

Madigan and MacSharry, by contrast, had been negotiating over agricultural trade all week, with one session lasting until 2 a.m. Asked if he and his European counterpart had made any progress, Madigan said Friday: “It’s very difficult to say. It’s all in the eye of the beholder.”

Dunkel, in releasing his draft agreement late Friday in Geneva, asked the 108 nations in the trade talks to be prepared to appraise it when negotiations resume Jan. 13. Between now and then, Dunkel said, he expects negotiators to give his draft “the most serious and urgent consideration at the highest political levels in your capitals.”

Hills promised to consult “intensively with the Congress, our private-sector advisers and others to determine their views.”

A senior U.S. trade official in Geneva, speaking on condition of anonymity, said Dunkel’s draft failed to identify possible settlements even on issues where there has been little disagreement.

Speaking without having seen Dunkel’s final draft, which was issued at midnight, the official said it would apparently satisfy U.S. demands for rules governing trade in services--an area not now covered by international trading rules. He said it would be “a very good text in a number of respects in both the patent and copyright fields,” where the United States is seeking international acceptance of U.S. rules.

Other countries have been less receptive than the United States to Dunkel’s strategy. French Prime Minister Edith Cresson complained Wednesday that a preliminary version of Dunkel’s draft supported U.S. positions “without any regard for European interests, whether in agriculture or other fields.”

U.S. and EC negotiators, deadlocked most of the last year over farm trade, edged closer together last month, when President Bush reduced the U.S. demand for a 75% reduction in EC farm subsidies over a 10-year period to 35% over five years. Negotiators have made no substantial progress since.

Havemann reported from Brussels and Tumulty from Washington.