WTO wrangles with several contentious issues

Wed, 11 Dec 1996, 00:00 WIB | Source: JP

By Riyadi

SINGAPORE (JP): Talks on competition policy, investment treaty
and textiles grew heated on the second day of the inaugural World
Trade Organization (WTO) ministerial conference yesterday.

But talks on the Information Technology Agreement (ITA)
proceeded smoothly, with four major trading countries -- the
United States, Japan, Canada and European Union -- resolving
their differences.

Indonesian Minister of Industry and Trade Tunky Ariwibowo
said here yesterday that trade ministers from 125 WTO member
countries had made strides on competition policy.

"There are more and more countries supporting the idea of
governing level playing fields at an international level rather
than at a national level," Tunky told reporters.

Indonesia has resisted efforts by developed countries to link
trade with domestic competition policy. Instead, it has urged the
WTO to focus on international aspects of competition.

On an investment treaty, Tunky said member countries'
positions still varied: "We just need to talk more about it."

WTO information director Keith Rockwell told a press
conference last night that several countries were no longer
opposing a multilateral investment treaty.

But those who could accept an investment treaty demanded it be
thoroughly studied by United Nations' bodies before being
negotiated at the WTO.

"I make it clear here that there was not yet any consensus on
issues related to investment and competition policy," Rockwell
said.

WTO trade ministers started their formal talks here yesterday
on the contentious issues which could not be resolved by
officials in Geneva. They focused on seven unresolved paragraphs
in the 20-paragraph draft WTO declaration.

Tunky said the disputed paragraphs mostly covered new
contentious issues, including the investment treaty, competition
policy, government procurement, and old issues including textiles
and agriculture.

"We all hope we can mend our differences and finally issue a
declaration at the end of the conference on Friday," Tunky said.

Developed and developing countries are virtually polarized
when talking about new issues. Sources indicated the United
States and Canada were holding out on a clause on textiles and
clothing as leverage for labor, competition and investment
issues.

Indonesian Director General of Foreign Economic Relations
Soemadi Brotodiningrat confirmed this, saying the two countries
promised to clean up their reservations on textiles and clothing
provided textile exporting countries agreed on their proposed
contentious issues.

Developed countries, especially Japan, South Korea and those
of the European Union, have opposed developing countries'
campaign to make the declaration more explicit on agriculture.

Rockwell said countries sensitive about agriculture insisted
that negotiations on it should not start before the end of 1999,
as mandated by the WTO agreement.

Rockwell said about 40 countries had participated in the U.S.-
initiated talks on ITA and had committed to an accord.

He said once the ITA was agreed, it would subscribe to most
favored nation principles, meaning that even those not
participating in the agreement could benefit from lower tariff
rates on information technology imposed by participating
countries.

Signals from negotiators have left little doubt that major
traders are aiming for an ITA agreement this week, as indicated
by acting U.S. Trade Representative Charlene Barshefsky.

Japan's Foreign Minister Yukihiko Ikeda told the second day
of the conference that he hoped "ardently ... that we will have
an agreement as the most significant achievement of this
ministerial conference in the area of trade liberalization."

The accord would incorporate the Asian developing economies,
most likely including Indonesia, which have a growing role in the
trade of computers and microchips. The accord would remove all
tariffs in the information technology sector, which is predicted
to be worth US$600 billion a year by the year 2000.

Secretary-General of the Indonesian Ministry of Tourism, Post
and Telecommunications Jonathan L. Parapak said Indonesia would
surely benefit from freer trade of information technology.