TNAG-1492-FCO40-2050-Future-of-Hong-Kong-General-Agreement-on-Tariffs-and-Trade-(-1986 — Page 19

PREPCOM

7.

DISCUSSION WAS GENERALLY MORE SHARPLY FOCUSSED, BASED ON THE GATT SECRETARIAT AND INDIVIDUAL CPS TEXTS, BUT THERE WAS LITTLE SUBSTANTIVE PROGRESS OR SENSE OF URGENCY AS CPS REHEARSED POSITIONS ALREADY MADE FAMILIAR IN THE SENIOR OFFICIALS' GROUP (SOG) TO WHICH MANY REFERRED. THE MAIN INTEREST CENTRED ON AGRICULTURE AND SUBSIDIES WHERE AUSTRALIA SHARPENED THE DISCUSSION,

FORCING THE EC ON THE DEFENSIVE.THE US LIMITED

THEMSELVES TO SHORT BALD STATEMENTS OF STANDARD POSITIONS AND RARELY JOINED THE DEBATE.

AGRICULTURE AND SUBSIDIES

8.

OXLEY (AUSTRALIA) STRESSED THE GROWING CONFLICT ON AGRICULTURE BETWEEN THE US/EC. HE CALLED FOR THE INCLUSION OF AGRICULTURE ON THE BASIS OF W/18, AND FOR A PHASE OUT OF EXPORT SUBSIDIES OVER A TEN-YEAR PERIOD AS PROPOSED IN W/28. ASEAN, ARGENTINA, BRAZIL, INDIA, COLOMBIA, CHILE, YUGOSLAVIA, NEW ZEALAND, POLAND GENERALLY SUPPORTED. HARDLINE LDCS PREFERRED ARGENTINA'S APPROACH (W/16) WHICH ́ PUT THE ONUS OF RESPONSIBILITY UPON DEVELOPED COUNTRIES. THE US COULD ACCEPT THE NOVEMBER 1984 DECISION AS A STARTING POINT.

9. TRAN (EC) POURED COLD WATER ON THE AUSTRALIAN PROPOSAL. IF AGRICULTURE WAS TO BE INCLUDED IN THE NEW ROUND (WHICH WAS NOT YET ACQUIS (UNDERLINED), IT MUST BE ON THE BASIS OF A REALISTIC AND GLOBAL APPROACH. AGRICULTURE COULD NOT BE TACKLED WITHOUT THE EC. IT WAS COUNTER-PRODUCTIVE TO INSIST ON UNREALISTIC DEMANDS. JAPAN, SWITZERLAND, NORDICS AND AUSTRIA, GENERALLY SUPPORTED, STRESSING SPECIFICITY.

10.

THERE WAS A PROCEDURAL DEBATE BETWEEN THE EC AND AUSTRALIA OVER THE NEGOTIATING FORUM, AUSTRALIA INSISTED ON A COMPREHENSIVE APPROACH TO INDUSTRIAL AND AGRICULTURAL SUBSIDIES ON THE BASIS OF THEIR PROPOSAL (W/29). ARTICLE XVI:1 SHOULD BE RENEGOTIATED TO LIMIT SUBSIDIES AND EXPORT SUBSIDIES ON PRIMARY PRODUCTS SHOULD BE MADE COMPARABLE TO THOSE ON MANUFACTURED PRODUCTS. NEW ZEALAND SUPPORTED. COLOMBIA, URUGUAY, CHILE, US, SUPPORTED THE NEED FOR IMPROVED RULES ON ALL SUBSIDIES. US INSISTED THAT THE NEGOTIATIONS SHOULD START FROM THE BASIS OF ARTICLE XVI, AND WAS WILLING TO NEGOTIATE IN MORE THAN ONE FORUM. TRAN RETORTED THAT THE EC HAD REPEATEDLY SAID IT WOULD ONLY DEAL WITH AGRICULTURAL QUESTIONS IN A SINGLE NEGOTIATING BODY. NO OTHER APPROACH WAS ACCEPTABLE.

TEXTILES

11.

HARDLINE LDCS LED BY INDIA CONTINUED TO MAKE MAXIMUM DEMANDS (W/3), STRESSING THE LINK BETWEEN THE RENEWAL OF THE MFA AND THE LAUNCH OF THE NEW ROUND AND DEMANDING A POSITIVE APPROACH FROM DEVELOPED COUNTRIES. TRAN (COMMISSION) BLUNTLY DISABUSED THEM OF THE PROSPECTS OF ELIMINATING THE MFA IN THREE YEARS AS IN W/3. HE ASKED WHETHER LDCS WERE PREPARED TO ACCEPT THE POLITICAL ODIUM OF BLOCKING THE NEW ROUND. THE EC MIGHT GO AS FAR AS A STANDSTILL ON TEXTILES ON THE BASIS OF THE MFA, BUT COULD OFFER NOTHING ON ROLLBACK. US AGREED BUT DID NOT REJECT OUTRIGHT A ROLLBACK ON TEXTILES ON THE BASIS OF A NEW MFA.

CONFIDENTIAL

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