COUNTRIES AT WTO GATHERING SAY EU HAS NOT CONFORMED TO ACCORD

COUNTRIES AT WTO GATHERING SAY EU HAS NOT CONFORMED TO ACCORD

Rich and poor nations this week criticized the European Union's trade regime and questioned the bloc's conformity with agreed global rules.

During a two-day review here of the EU's trade policies by the World Trade Organization - the Geneva-based trade watchdog - more than 20 nations aired their concerns.They complained about restrictive and trade-distorting measures affecting industries such as agriculture, trade in goods, investment, services and government purchases.

The EU, which played a key role in the conclusion of the "Uruguay Round" liberalization accords, was accused of deviating from both the spirit and the letter of these agreements.

Farm exporting nations, including the United States, Canada and Australia, fear the EU already is meandering away from its Uruguay Round commitments.

Christopher Marcich, assistant U.S. trade representative, said, "We see renewed clouds on the horizon" in the EU's farm sector. He underlined Washington's concern about the failure by Brussels to implement fully its preference commitments for grain.

Similarly, Canada's Pierre Gosselin said Ottawa has "great concerns" about the manner in which the EU is proceeding to implement its market access commitments on agriculture.

The EU's subsidy-studded Common Agricultural Policy (CAP) also drew a great deal of concern, and the United States queried the EU's restrictive import regime on bananas.

Don Kenyon, Australian representative, said the EU needs to introduce some stiff disciplines in its subsidies in the coal mining sector.

Indeed, a WTO report released Tuesday says that in 1992, German coal producers accounted for nearly 89 percent of the 5.0 billion European Currency Units (US$6.25 billion) in EU subsidies channeled to this sector.

The Polish delegation complained that aid to shipyards in the former East Germany apparently had led to capacity increases.

A litany of complaints also was presented about the EU's tariff peaks for farm products and the high excise taxes on tropical products such as coffee in some member states.

Noise also arose about the above-average tariff rates for a range of so- called "sensitive" products such as microprocessors, footwear, textiles and apparel, consumer electronics and some types of motor vehicles.

Moreover, developing nations complained about their disappointment at the failure of the EU to include any restricted categories in the first phase of the Multi-Fibre Arrangement, which regulates the world's trade in textiles and textile products.

They also drew attention to the apparent bias in the EU's new four-tier Generalized System of Preferences. GSP is a program of preferential tariff treatment granted by various industrialized nations to developing nations.

In particular, developing countries registered their concern about the threat of GSP safeguards being linked, beginning in 1998, to areas such as the environment and labor standards.

As the WTO report points out, the system also puts larger developing nations at a disadvantage and tends to discourage nations from concentrating exports to the EU in a narrow range of products.

However, EU representative Roderick Abbott said that the new arrangement had been deliberately formulated in order to assist least-developed nations more than other developing nations.

Japan, the United States and other countries expressed concern about the various preferential and free-trade arrangements between the European Union, the European Economic Area and Eastern European economies, and the launch of a new Euro-Mediterranean policy.

However, the EU countered that in its enlargements, the EU followed the relevant global accords. It argued that some of the latest initiatives reflect geopolitical realities and should not be viewed rigidly.

It added that fears of trading partners being "left out" by the EU were thus unjustified.

It is the EU's conviction that the system of preferential and regional trade arrangements constitute "an open regionalism complementary to liberalization within the WTO," said the EU's Jean-Pierre Leng.