Last Gasp for GATT

February 07, 1991

Big business in the United States, Japan and the European Community is mounting one last try to save and broaden the international trading system before it founders over agriculture policy.

Unless the EC backs away from high farm support prices and export subsidies before the end of February, Congress may go on a protectionist binge -- refusing to extend the president's negotiating authority under the General Agreement on Tariffs and Trade and renewing the "Super 301" provisions of 1988 legislation that would require automatic retaliation against certain countries, especially Japan, that engage in unfair practices.

If all that comes to pass, GATT would start to wither as regional trading blocs and special bilateral deals increasingly dominate the world trade scene. (Note the rapid development of a U.S.-Mexico-Canada combo to offset the 12-nation EC.) Hopes of widening the scope of GATT from manufactures to service industries, intellectual property rights and agricultural products would be a goner.

GATT has been under intensive care since a supposedly final session of the four-year Uruguay Round negotiation collapsed in bitterness Dec. 7. Efforts to revive it have produced only posturing and platitudes so far. President Bush has until March 1 to ask Congress to permit further bargaining, perhaps for only six months, but his special trade representative, Carla Hills, has said she won't even make such a request unless the Europeans start to deal. Chances are fading fast.

Even if the administration claims enough progress to move ahead, there is no assurance Congress will agree. Thirty-seven senators, including Maryland Democrats Paul Sarbanes and Barbara Mikulski, signed onto a protectionist resolution last fall that would hobble the administration and, in effect, kill any chance of a new GATT agreement. Free-trade groups hope to impress Senator Sarbanes with the adverse foreign-policy implications of a U.S. descent into protectionism -- especially since our chief adversaries, Japan and the European states, are the very nations whose support is needed in the gulf war.

If there is ever to be a stable, peaceful "new world order" after the war, a free flow of commerce will be one of its key underpinnings. On this issue, the United States and most developing countries in the Third World are solidly on the same side. We hope our two senators reconsider.

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