w GATT Newsletter

77 December 1990

Ministerial Meeting in Negotiations to continue in he Uruguay Round negotiations T have been prolonged and will be pursued in Geneva under the responsibility of GATT Director- General Arthur Dunkel. This was agreed by Ministers at the end of the Trade Negotiations Committee (TNC) meeting held 3-7 December 1990 in Brussels. Uruguay's Foreign Minister Hector Gros Espiell, TNC chairman at ministerial level, said that while the Brussels meeting "has made a substantial contribution to advancing the negotiating process", he had reached the conclusion that "par­ ticipants need more time to reconsider and reconcile their positions in some key areas of the negotiations". He TNC Plenary Session at the Brussels International Conference Centre. added: "More time is also needed to ensure 46th Session of the Contracting Parties that the positions of all participants are taken into account, in accordance Rapid success in the Round urged with the multilateral character of the negotiations. We shall deploy El Salvador set to accede; EC Waiver request approved our best efforts in undertaking this task. In doing so, we are mindful hile noting a sense of "col­ prospects are likely to regress of the need to conduct an effective W lective frustration and lost seriously. The system that we have evaluation of the extent to which opportunity" following the Brussels now with all its admitted imper­ the objectives relating to differential meeting. Chairman John Weekes fections may no longer be able to and more favourable treatment for (Canada), at the Forty-Sixth Ses­ serve as one of the principal engines developing countries are being sion of the Contracting Parties of economic and social growth and attained". held 12-13 December, urged "a development"; {continued on page 5) rapid and successful outcome to The Ministers approved Mr. CONTENTS Espiell's proposal that Mr. Dunkel, the Uruguay Round". in his capacity as TNC Chairman In his review of the state of world Environment and trade 6 at officials level, "pursue intensive trade, the Chairman pointed out that consultations in the period from "decisions to trade, to invest and GATT honours its first now until the beginning of next to create jobs have never been more Director-General 7 year with the specific objective of dependent on a stable and coherent achieving agreements in all the areas trading system". The need for a Officers for 1991 7 of the negotiating programme in successful conclusion to the Round, which differences remain he said, was highlighted by the El Salvador signs outstanding". following: Accession Protocol 8 • "Without the reinforcement and Mr. Dunkel was given the mandate extension of the trading system, Falling prices unsettle to reconvene the TNC "at the which for the past four years we dairy market 8 (continued on page 2) have been seeking, world trade 2 URUGUAY ROUND Negotiations (continued from page I ) appropriate level to conclude the negotiations at the date he considers appropriate in the light of his consultations". The consultations by Mr. Dunkel would be based on the following: • The draft Final Act embodying the results of the Uruguay Round negotiations submitted to the Ministerial TNC Meeting in Brussels; and • The considerable amount of work carried out during the Brussels meeting. Mr. Arthur Dunkel, TNC chairman at officials level, had presented his 391 -page report which consisted of texts of commentaries in each of the 15 areas covered by the Round. Some 1,600 delegates were accredited to the TNC Meeting "We have in our grasp all the ingredients necessary for a substantial • Jaime Serra Puche, Trade and package of results," he said. Industry Minister of Mexico - He said the report highlighted "the Services; points on which even the best drafters • Hassan Abouyoub, Trade Minister and technicians cannot offer solu­ of Morocco - Textiles and Clothing; tions without political guidance and • John Crosbie, Trade Minister of breakthroughs". He noted that in Canada - GATT Articles, Anti- three areas - agriculture, trade-related Dumping, Subsidies and investment measures and anti­ Countervailing Measures and dumping action - the Geneva Safeguards; negotiators had not been able to • Anita Gradin, Trade Minister of develop texts which could serve as - Trade-Related Investment an agreed basis for negotiations. In Measures and Trade-Related As­ TNC Chairman Hector Gros Espiell areas where texts had been developed pects of Intellectual Property Rights; (e.g. rules of origin, textiles and • Dato' Seri Rafidah Aziz, Trade clothing, subsidies and countervailing Minister of Malaysia - Market Statements by delegations measures, trade-related intellectual Access; and he opening ceremonies on 3 property rights, safeguards and • Yvonne Van Rooy, Foreign Affairs TDecember started with His services), Mr. Dunkel pointed out Minister of the - certain Majesty, King Baudouin of , that key political decisions were Non-Tariff Measures (Preshipment greeting each head of delegation. needed to complete the work. Inspection, Rules of Origin, The King also attended the formal Emphasizing the short time Technical Barriers to Trade, Import opening of the plenary session on available, Mr. Dunkel said there Licensing, Customs Valuation and 3 December at which Belgium and was no option "but to negotiate, Government Procurement). the European Community welcomed negotiate and negotiate and waste Work started that same evening to Brussels some 1,600 delegates, including about 90 Ministers. The no time in political shadow boxing with the various working groups or mutual recrimination". participants then decided to using the draft Final Act, negotiated immediately get to work. At an informal meeting of heads in Geneva, as the starting point. of delegation on late Monday Mr. , Prime The Chairman held at regular intervals afternoon, Mr. Gros Espiell said Minister of Belgium, said it was the large number of negotiating areas informal meetings with heads of a great honour for his country to meant that the participants could delegations to keep them informed welcome all those who "have been not afford to deal with only one of developments across-the-board. endeavouring to give written ex­ subject at a time. He suggested that By late Thursday it became clear pression to our aspirations for an work should start simultaneously that whatever progress was being open world and for fairer and more on a manageable number of subjects made in other negotiating areas, the balanced trade". He observed that and that he had requested the following work on agriculture could not be the negotiations "have been arduous Ministers to help him in the con­ advanced, despite intensive efforts and are likely to remain so until sultations: to seek new approaches. the end, but it would be unthinkable • Mats Hellstrom, Agriculture At noon on 7 December (Friday), not to succeed". Minister of Sweden - Agricul­ Mr. Gros Espiell announced the Mr. Robert Urbain, Belgium's ture; decisions reported above. Foreign Trade Minister, said that URUGUAY ROUND 3 market in the world". "Let us together summon the political will to dismantle our trade barriers and in so doing increase our global economy by over $4 trillion in this decade of the 90s", she concluded. Trade Negotiations Minister Neal Blewett of Australia said agricul­ ture had been described as "the linchpin" of the Round. He stressed that the Cairns Group was of the view that the Round "cannot, and will not, conclude without a satisfactory outcome in this area". Expressing regret about the standstill in agriculture negotiations, he said the EC offer on agriculture was "seriously inadequate ... the time has come for the Community to show that it will not allow the entire Round to fail forwant of commitments to genuine and urgently needed agricultural reform - reform which is in the Community's own interest". The Round at centre-stage: some 1,300 journalists covered the Brussels Meeting. Canada's Trade Minister John C. Crosbie said agriculture was apriority the Brussels meeting "will mark the Delegations took the opportunity for his country in the Round. He beginning of a new enterprise that to highlight their main concerns in called for improved access to markets, we shall be able to pursue patiently, the negotiations. and effective and equitable rules resolutely and systematically, on The EC Council President, 's on agricultural trade. "It is our farmers, the basis of the foundations laid Trade Minister Renato Ruggiero, not our treasuries, who should compete here". stressed that there was "no viable in the world markets," he said. Mr. Mr. , President of alternative to the reinforcement of Crosbie reported that Canada, together the Commission of the European the multilateral trading system." He with , Sweden and Switzerland, Communities, said "International said "The dramatic mistakes of the had put forward a proposal to ensure trade sets the pulse of the European past based on policies of 'every man non-discrimination and liberalization Community's economy ... I have for himself, and the explosive risks of trade in the financial services said this at the outset so as to remind which would be entailed in an sector. you, if needs be, of how important anarchical system of world trade Japan's Trade and Industry Minister the stakes in these negotiations are based on the law of the jungle and Kabun Muto said his country had for us, and how resolved we are on might being right, bear witness contributed to a favourable negotiating to reach a successful conclusion ... to the need for an absolute refusal environment by initiatives to promote The Community is now too involved to slacken our vital attachment to imports. In order to bring about in the world economy not to take the GATT..." He added that "our breakthroughs in the negotiations. into account, both in its thinking responsibilities as politicians also Ministers "should make decisions and in its actions, the future of the compel us to weigh carefully the on specific policy options from a world economy as a whole ... The consequences of the solutions which broaderperspective". In this regard. growth of trade of every kind is we produce..." Mr. Muto called for a constructive one of the essential conditions for US Trade Representative Carla compromise in the anti-dumping moving towards a more efficient A. Hills said "Only one thing stands negotiations aimed at establishing world order, as well as one in which between us and the triggering of "clear and objective international there is greater solidarity and fairness." a world-wide economic renaissance: rules". At the plenary meetings, many the stalemate over agriculture". The Indonesia's Trade Minister Arifin delegations paid tribute to the efforts fate of the Round hung in the balance M. Siregar. speaking on behalf of of negotiators since the launching because in the agriculture negotiations the ASEAN contracting parties, said of the Uruguay Round in September "a few countries have refused to the region's future "lies in the con­ 1986. Considering the Round's unpre­ negotiate specific commitments to tinuation of an open and fair world cedented breadth of coverage (fifteen lower trade-distorting supports, to trading system which guarantees negotiating areas ) and participation open their markets to imports, and that countries could pursue their (107 countries), it was perhaps not to reduce their use of export subsidies". development objectives by doing surprising that many issues remained Mrs. Hills also called for a market- what they can do best". The ASEAN outstanding after four years opening agreement in services, countries, he said, were willing to of negotiations. But the delegations including financial services. She assume a greater share of responsibility were unanimous in emphasizing the urged participants to follow the US for an open, viable and durable critical importance of the meeting. example as "the most open services multilateral trading system "provided ^ 4 URUGUAY ROUND • that the rules are fair and equitable". Mr. Siregar called for significant and meaningful results in the negotiations on market access, textiles and clothing, agriculture, anti­ dumping, subsidies and countervailing measures, and safeguards. Madagascar's Trade Minister Georges Solofoson. spokesman for the African countries, stressed the importance of improved market access and expressed concern that proposals in this regard were "likely to lead to losses which exceed the gains, due to erosion of existing preference margins and the conditionality of all the offers on tariff concessions". In the light of the difficult economic situation of African countries, Mr. Solofoson said they "have placed great expectations on the Uruguay Round as a means to extricate themselves from this situation through more effective participation in world trade and in the international trading system". Swiss Federal Counsellor Jean- Pascal Delamuraz, head of the Department of Public Economy, said the GATT negotiations had contributed to ongoing agricultural reforms in many countries, including Switzerland. "Let us give these reforms a multilateral legal framework so as to rid the multilateral trading system of a poison, once and for Belgian hostesses made life easier for journalists encamped at the Press Centre all," he said. "Agriculture needs a market but in our regions, too much and that "a cornerstone in this process financial and technical assistance market would kill it - and we will is the multilateral trading system for the development of agriculture. not tolerate the death of our based on the institutionally Chile's Minister of the Economy countryside", he added. strengthened GATT, with reinforced Carlos Ominami said that despite 's Trade Minister Eldrid disciplines and extended scope of having bound its tariffs at 35 per Nordbo said there were "important operation". In agriculture, he stressed cent during the Tokyo Round, his interlinkages between trade and that " in the reform process, the burden country was prepared to confirm environmental policies and these of adjustment had to be equitable its continued commitment to the are not only linked to agricultural for all participants ... credit should multilateral trading system by offering trade". She drew attention to a draft be given for autonomous cuts in a further reduction of its tariff bindings statement submitted by the EFTA support and protection undertaken across-the-board. He expressed countries to the TNC which since the launching of the Uruguay considerable concern that "little or emphasized that "priority attention Round". nothing has been done in respect in the future should be devoted to Bangladesh's Commerce Minister of natural resource-based products". the issue of interlinkages between Mokammel Haque urged partici­ He stressed the importance of a trade policy and environmental pants to recognize the particular successful Round because "the policy". situation and problems of the least- formation of closed trading blocs Hungary's International Economic developed countries. He called for and the exercise of trading power Relations Minister Bêla Kadar said special treatment in several areas, without clear-cut rules increases the that since the launching of the Round, including: providing for adequate vulnerability of countries such as "political changes of historic food aid as an integral part of the Chile that sincerely wish to contribute significance have taken place in the agricultural reform programme; to the integration of the interna­ world... the free democratic elections unhindered movements of and tional economy". in Hungary, and also in other Central temporary residence for the least- Some 72 Ministers spoke during and Eastern European countries developed countries' service the Plenary Sessions. Statements resulted in full systemic change". providers; special rules of origin were also made by heads of the His country's basic objective was allowing for lower local content UN, World Bank, the IMF and reintegration into the world economy requirements; and adequate direct UNCTAD • CONTRACTING PARTIES 5 Rapid success (continued from page 1 ) • "We have moved from 96 to 100 contracting parties with the very welcome additions of Bolivia, Costa Rica, Tunisia and Venezuela. Right now we have another eight countries at one stage or another in the ac­ cession process. It has been noted before that the political price these countries are being asked to pay for membership can be a high one. Their determination to proceed, however, reflects their conviction that it is a price worth paying, that it fits comfortable with the major economic changes they are undertaking unilaterally and that such a commitment to the multilateral system is necessary in the light of Changing of the guard: Chairman John Weekes congratulates Ambassador Rubens Ricupero, the sweeping changes expected from newly-elected Chairman of the Contracting Parties. At centre is Mr. Stuart Robinson, director of the GATT Council and Session Affairs Division. the Uruguay Round. This has been the view taken by many developing Venezuela)joinedtheGATTin 1990 assessment of individual contracting countries and most of the countries while eight countries were in various parties' trade policies, and an important of Central and Eastern Europe ... stages of the accession process. The source of transparency," he said. They are perhaps beginning to wonder Soviet Union had expressed interest Ambassador El Ghali Benhima whether the reforms and commitments in accession and had been accorded (Morocco), Chairman of the they have undertaken could have observer status. Poland had sought Committee on Trade and been misplaced if the long-standing to renegotiate terms of accession Development, said that in October, GATT members who have as a market-based economy. And the Committee carried out a com­ encouraged them appear unable finally, the former German prehensive review of the technical themselves to live up to the key Democratic Republic had been assistance provided by the GATT objectives of the Round". integrated into the European since the start of the Round. "It was Community and accordingly into generally felt that the Technical the GATT system. Cooperation Programme of the GATT Reports of the Council Mr. Ricupero suggested that the had been successful and had played and the CTD Council deal with the following a very positive role in enhancing s is customary, the year-end questions next year: developing countries' participation A Session was the occasion for • How to deal with requests for in the Round", he said. the Contracting Parties to review waivers, keeping them from Mr. Benhima noted that "a large the activities of GATT standing becoming semi-automatic and at number of representatives have bodies, including the Council of the same time taking account of emphasized the need for continuing Representatives, the Committee on the different trade policy needs and intensifying technical assistance Trade and Development and the which give rise to individual provided by GATT and other in­ various Committees overseeing the requests; ternational organisations, through implementation of the Tokyo Round • How to implement improvements voluntary contributions by Agreements. in reporting on developments in governments after the completion The Council's work had continued regional agreements as the biennial of the Round". According to them, unabated despite the accelerated pace calendars for reporting have not this would be particularly useful of the Uruguay Round negotiations been followed for some time: in helping developing countries in 1990. reported Chairman • How to improve the procedures analyze, assess and implement the Ambassador Rubens Ricupero for derestricting documents since results of negotiations as well as (). He said "This underscored GATT was now of increasing making use of those results. the Council's important role in carrying interest to the press, the schools, out the day-to-day tasks of managing private business persons and their El Salvador set to accede the multilateral trading system as lawyers, and the general public. he report by the Working Party it already exists, even as new and Mr. Ricupero reported that the Ton the Accession of El Salvador improved rules were being Council had held nine special meetings was presented by its Chairman. negotiated". in its first series of reviews of the Ambassador Emilio Artacho (). He noted events in 1990 which trade policies and practices of GATT He reported that the Working Party had contributed "towards the univer­ members under the Trade Policy had concluded that El Salvador should salisation of the multilateral trading Review Mechanism. "Ourexperience be invited to accede to the GATT. system while at the same time posing has shown that this mechanism is El Salvador said that the decision challenges to it". Four governments developing into a useful tool for to join the GATT was made after (Bolivia, Costa Rica, Tunisia and the multilateral appreciation and consultations with the private sector. ^ 6 • It was in line with a new economic policy which aimed, among others, at the more efficient integration of Environment and trade El Salvador into the world market. witzerland, speaking on behalf prohibited goods, industrial hunting Trade was crucial for El Salvador, Sof EFTA members, said they of whales, shipment of toxic waste considering its small domestic market intended to follow up an initiative and destruction of forests. and the lack of vast natural resources. in the Uruguay Round to discuss The ASEAN countries said the It remained committed to promoting environmental issues and trade. environment was a major concern regional economic integration in Many GATT members, Switzerland and that they were preparing specific Central America. The country's said, had taken measures to protect recommendations for submission ongoing economic liberalisation the environment and internatio­ at the next Council meeting. programme would lead to the nal cooperation in this regard should India said GATT members whould elimination of discriminatory and be intensified. It said these have to study whether GATT was discretionary restrictions. El Salvador environmental measures might the right forum for discussing said its liberalisation measures should have trade effects. Thus, there was environmental issues. be given adequate credit in the an urgent need for G ATT members Uruguay Round negotiations. Nigeria said it supported the to gain a better understanding of inclusion of environmental pro­ The Contracting Parties adopted the subject of environmental policies tection into the work programme the report of the Working Party on and GATT rules. The EFTA of the GATT. It added that the the Accession of El Salvador. Shortly countries were studying concrete work of the Working Party on after the closure of the Session, the steps regarding the initiative and Domestically Prohibited Goods was Contracting Parties, through ballot, would be submitting a proposal a modest beginning to this pro­ approved the accession Protocol of to the GATT Council. gramme. El Salvador (see related story on Sweden, speaking on behalf of On this subject, the Contracting page 8). the Nordic countries, said Parties extended the deadline from environmental issues can have trade the end of this year to end of CPs grants waiver on implications and vice-versa. This March 1991 for the completion was a fairly urgent issue and it of the work of the Working Group German trade measures was high time that trade-policy on the Export of Domestically he Contracting Parties voted to considerations be introduced into Prohibited Goods and Other Tgrant a waiver for transitional the discussions on the environment. Hazardous Substances. The EC trade measures related to the emphasized the impor­ Working Group Chairman, unification of (see previous tance of protecting the environment Ambassador John Sankey (United Focus) and established a Working and suggested that GATT should Kingdom), reported that the Group Party to examine these measures. participate in the preparatory work was considering a draft Decision The EC trade measures aim at for the 1992 World Conference on Products Banned or Severely maintaining existing trade flows on the Environment. Restricted in the Domestic Market. between the former German The European Community said Upon adoption, this Decision Democratic Republic and CMEA it was ready to initiate dialogue would mean that all trade in countries (Eastern Europe and the on this issue. It said that domestically prohibited goods Soviet Union). environmental protection was a would be under the auspices of In calling for a roll-call vote, the global issue which should be tackled. an international organisation, he Community stressed that the historical Chile stressed that any said. The Group, however, had process of German unification should environmental measure should be not been able to reach consensus not be hindered by mercantile interests. non-discriminatory. It cited as on this draft Decision because one It was requesting a time-limited waiver environmental problems nuclear member had reserved its position, only up to 31 December 1992, and testing, sale of domestically- the Chairman said. • was ready to take into account concerns by other GATT members. The EC said it would be amenable, This meant a two-thirds majority recommended the revocation and after the granting of the waiver, to of those voting had been secured reimbursement of the US duty. the establishment of a working party consisting of more than 50 per cent Sweden said that despite the clear to examine these measures. of the total number of Contracting verdict, the panel report had not The United States said it was Parties, as required under the rules. yet been adopted. opposed to the EC request because The United States said that it had a thorough examination must precede Dispute settlement made clear in the Committee that the granting of a waiver from GATT weden expressed concern about it had no substantial problem with provisions. It recalled that every Sthe lack of progress regarding the report. Its main concern was significant waiver in had been the its complaint against US anti-dumping that the Panel had suggested a specific GATT granted only after the duties on imports of Swedish stainless remedy when the usual procedure establishment of a working party. steel pipes and tubes. It had lodged was for governments to have The EC request was carried by this complaint in the Committee on responsibility in determining how 56 votes in favour, three against Anti-Dumping Practices in 1988. to implement panel recommendations. (US, Japan and Hong Kong) and In August 1990, a dispute settlement The Contracting Parties decided five abstentions. panel established by the Committee (continued on page 7) CONTRACTING PARTIES

Election of officers of the Contracting Parties At the close of the forty-sixth session of the Contracting Parties, held in Geneva on 12 and 13 December, the following officers were elected for the period until the end of the forty-seventh session: Chairman of the H.E. Mr. Rubens Ricupero Sir Eric Wyndham White. Contracting Parties Ambassador Permanent Representative of Brazil Vice-Chairmen of the H.E. Mr. El Ghali Benhima GATT honours Contracting Parties Ambassador Permanent Mission its first Director- of the Kingdom of Morocco H.E. Mr. Fredo Dannenbring General ' Ambassador he Contracting Parties of the Permanent Mission of Germany TGATT, at their annual Session, H.E. Mr. David Hawes have decided to name the principal Ambassador conference room at their headquarters Permanent Mission of Australia in Geneva as the "Salle Eric Wyndham Chairman of the Council H.E. Mr. Lars E.R. Anell White" in honour of their first Director- Ambassador General who served as the head of Permanent Mission of Sweden the GATT Secretariat from its inception in 1948 until 1968. The Chairman of the Committee H.E. Mrs. Narcisa L. Escaler proposal to honour Eric Wyndham on Trade and Development Ambassador White was made by the Chairman Permanent Mission of the Contracting Parties, of the Philippines Ambassador John M. Weekes of Canada. Mr (later Sir) Eric Wyndham White and yoghurt. The United States to the establishment of a panel. (1913-1980) can be said to have reiterated its concern that Canada Australia expressed a trade interest played the role of "mid-wife" at the had not yet made clear how it in this case. birth of the GATT which emerged would implement this panel re­ • US countervailing duty on fresh, from the Preparatory Committee port. It reported that it had completed chilled and frozen pork from for the International Trade apreliminary list of products which Canada. Canada urged the United Organization and the United Na­ would be the basis of withdrawing States to agree to the adoption tions Conference on International concessions. However, given the of the panel report. The US said Trade and Employment( 1946-1948 ) current state of the Round, the the situation was not ripe for where he served as Executive US said it would postpone action consideration of this report. Secretary and Secretary-General until the next Council meeting. reported that it was respectively. • Treatment of US beers in Ca­ consulting with the Community He steered the GATT through its nada. The United States expressed regarding compensation arising out formative years and helped to concern about indications that of the accession of Spain and consolidate the foundations of a Canada would not be modifying into the EC. It noted that it was secure and stable multilateral trading measures of provin-cial agencies the main supplier of sorghum and system. By the time he retired in in order to bring them into second largest exporter of corn to 1968, the number of Contracting compliance with an adopted panel the Iberian states before the Parties to the General Agreement report. It said Canada had imposed enlargement of the EC. had risen from the original 23 new restrictions on US beer since The United States reiterated a request signatories to 76 - confirming the 1988 and requested the for the establishment of a working need for multilateral cooperation establishment of apanel to examine party to examine the relationship and discipline in international trade this case. Canada stated that the of internationally-recognised labour and development. results of ongoing negotiations standards to international trade. It with the Community, the noted the request had been before complainant in the original panel the Contracting Parties for three Rapid success (from pa^ b, case, would be implemented on years. The United States said it had to refer the following US-Canada an mfn basis. Since it had received shown flexibility regarding the the US request for a panel only disputes (see previous Focus) to the establishment of various working recently, Canada had not had first Council meeting of 1991: parties even if it had doubts whether sufficient time to consult internally the issues fell under GATT • Canada's quantitative restric­ and thus was not ready to agree tions on imports of ice cream (continued on page 8) 8 FOCUS GATT Report Falling prices and rising export stocks unsettle international dairy market fter reaching record levels in • Cheese was one bright spot. A 1989. world dairy prices started While production continued to grow softening this year as production by 1.2 per cent in 1990. rising cheese continued to grow. This, together consumption has engendered a lively with falling butter consumption in import demand and expanding trade. Vice-Minister for the Economy Sr. Mario Ernesto Acosta Oertel. many industrialised countries, has • In late 1989 and throughout 1990. led to more offers of butter for exports prices for dairy products came under - forcing the GATT Protocol pressure in international markets. Committees on dairy products to Some offers and sales of butter and El Salvador urge, recently, that signatories fully skimmed milk powder were observe minimum export prices and reportedly made at prices below the signs Protocol to appeal to other dairy-producing minimum export prices agreed in countries for their cooperation. the Protocol Committees. Since sales of Accession These are among the findings of various dairy products are hardled contained in GATT's annual report by the same operators, the depressed to GATT on the international dairy products market prices for butter have also l Salvador's Protocol of Acces­ market, published in November.* adversely affected sales and prices sion to GATT was signed 13 of other dairy products, notably milk E Among the major trends identified powders. December at GATT Headquarters in the Report are the following: in Geneva by the country's Vice • The Protocol Committees • World milk production was rising established under the International Minister for the Economy Sr. Mario at a rate of 1.5 per cent in 1990 Ernesto Acosta Oertel. Accession Dairy Arrangement, concerned about as output again increased in the will take effect 30 days after the unsatisfactory situation dominated United States and the European ratification by El Salvador's legislative by a fragile butter market, have body. Communities; called on participants to fully observe The terms of the Protocol were • Prices of butter and skimmed the minimum export prices. An appeal negotiated in a working party whose milk powder have been under was also made to non-participants report was approved during the Forty- downward pressure since the not to offer or sell dairy products Sixth Session of the Contracting beginning of the year. In 1989, a at prices below prevailing prices. Parties held 12-13 December 1990. balanced supply-and-demand si­ tuation had almost eliminated in­ Under the regular procedures, the * The World Market for Dairy Products 1990, Protocol was put to a vote and the tervention stocks of these products. Eleventh Annual Report - available in English, necessary two-thirds majority of • World butter production in 1990 French and Spanish from the GATT Secretariat. GATT member states for its approval continued to grow at 1989's rate Price SwF 25. - 67 affirmative votes - was attained of 1.4 per cent. Vigorous demand shortly aftertheclosureof the Session. for low-fat products in many countries Contracting Parties In the Working Party, El Salvador has led to a substantial surplus of (continued from page 7) said that it remained committed to milk fat which is usually turned competence. It said it could not an economic reform programme into butter. Falling butter consumption accept a double-standard with respect which included the progressive in North America and Europe has to its request. reduction of tariff rates, elimination resulted in more butter being available The European Community of import prohibitions, elimination for export. Higher retail prices in supported the US request. India, of the protective effect of internal Eastern Europe have dampened Chile and the ASEAN countries taxes and derogation of discriminatory demand for butter there. As more reiterated reservations on the tax exemptions. butter was offered in the world market, competence of GATT to deal with El Salvador had pledged to bind prices started to fall entailing more labour matters. • its tariff schedule upon accession intervention purchases by at a maximum rate of 50 per cent governments. GATT FOCUS ad valorem, and to reduce further • The Gulf crisis has adversely this ceiling rate to 40 per cent ad affected trade in dairy products. Newsletter published 10 times a year valorem on 31 December 1993. It Iraq and Kuwait had been importing in English, French and Spanish by the Information and Media would also modify trade rules to annually some 50,000 tons of milk Relations Division of GATT conform with GATT provisions. El powders, some 20,000 tons of cheese Salvador intended to adhere to the and about 10,000 tons of butter and Centre William Rappard, Tokyo Round Agreements on anhydrous milk fat in recent years. 154 rue de Lausanne, 1211 Geneva 21 Customs Valuation, on Import Offering some compensation has Tel. 739 51 11 Licensing Procedures and on Anti- been a rising demand in other OPEC ISSN 0256-0119 Dumping Practices. • countries.