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Europe: Restrictions On High-Tech Trade Top WTO Conference

  • Ron Synovitz



Prague, 10 December 1996 (RFE/RL) -- Restrictions on the trade of computer and telephone technologies have emerged as a key issue at the World Trade Organization's (WTO) inaugural conference in Singapore this week.

Delegates from 128 countries in the WTO are attending the week-long conference in an attempt to agree on an agenda for international free trade during the next century. Other key issues include China's eventual membership in the WTO and whether workers' rights should be part of the organization's future agenda.

EU Trade Commissioner Sir Leon Brittan said today that the United States and the European Union (EU) are now close to agreement on a pact that would eliminate tariffs on computers, semiconductors, software and telecommunications equipment.

Following talks with U.S. Acting Trade Representative Charlene Barshefsky this morning, Brittan told reporters that he is optimistic a deal would be reached before Friday on the so-called Information Technology Agreement (ITA).

Both sides want to conclude the agreement in time for it to be endorsed by the remaining WTO countries this week.

Those with the most to gain from the agreement would be companies like Germany's Siemens, the U.S.-based Microsoft, and Korea's Samsung -- firms that are active in developing new technological infrastructures in Eastern Europe and the former Soviet republics, as well as in other developing economies.

But yesterday, the United States and EU were arguing over a handful of products that each side wants to protect from the full force of unrestricted trade.

The United States wants worldwide trade tariffs to be eliminated on computer semiconductors -- a major U.S. industry. The move would make U.S. semiconductors cheaper and more competitive outside of the United States. At the same time, Washington wants to keep its protective tariffs on optical fibers, photocopiers and some electronic parts.

UK Trade Minister Iain Laing yesterday charged that U.S. companies like Xerox and the fiber optics firm Corning have been pressuring Washington to retain duties that protect their U.S. market shares from foreign competitors.

Japan also is eager to protect its telecom cable manufacturers, while the EU wants to shelter its film and music industries by preserving its protective duties on videos and compact discs.

Analysts say that even if Europe and the United States reach an agreement, there could be problems ahead. Countries in Southeast Asia with large electronics exports want more time to eliminate their protective tariffs. They say their domestic industries cannot yet compete in the international marketplace.

Meanwhile, Washington is under pressure from U.S. and international labor unions to include labor issues in this week's WTO declaration. France and Norway also want the WTO to commit itself on workers' rights.

But several emerging economies in Asia -- including India, Malaysia and Indonesia -- insist that there should be no mention of labor issues at all. Those countries argue that even a neutral phrasing would suggest that work conditions are a subject for the WTO. Some EU countries are siding with Asian states that want to keep labor issues out of the WTO's realm.

Bill Jordan, of the International Confederation of Free Trades Unions, said putting labor issues on the WTO agenda would almost certainly erode the commercial advantage that lesser developed countries have due to cheap labor. But Jordan said the thrust of his campaign is to use the international forum to help improve often appalling working conditions in developing countries.

Meanwhile, the EU today launched a drive to restart talks on bringing China into the WTO. EU spokesman Peter Guilford said the Union is gauging the level of support for what he called a "phased in" approach to Chinese membership. Guilford admits that a breakthrough on the issue is unlikely this week.

Washington insists that Beijing must open its markets and eliminate trade barriers before it will support China's entry into the WTO.

While EU delegates in Singapore met with officials from Washington, British Foreign Secretary Malcolm Rifkind was in London yesterday chastising the EU for refusing to open its markets to East European countries.

Quoted in today's "Wall Street Journal Europe," Rifkind was especially critical of the EU's policy toward agricultural imports from its Eastern neighbors. He also criticized EU restrictions on textile imports from Russia, Ukraine and Belarus, as well as restrictions on steel imports from Russia, Ukraine and Kazakhstan.

Rifkind said there is "little hope" for the EU markets to be opened to Eastern Europe and the former Soviet republics soon. He said Brussels has linked the opening of trade with the continuation of economic reform in those countries.
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