TRADE NEWS BULLETIN Volume II Number 6 Monday, January 11, 1993 _________________________________________________________ NAFTA News Summary _________________________________________________________ CLINTON REAFFIRMS SUPPORT FOR NAFTA In a private meeting in Austin, Texas Friday, President-elect Bill Clinton told Mexican President Carlos Salinas de Gortari he would work quickly to complete the North American Free Trade Agreement. Clinton reportedly vowed not to reopen the agreement if parallel accords on labor and environmental issues are established. "I reaffirmed my support for the NAFTA and the conviction that there were some issues still outstanding between our two nations that need to be addressed," Clinton said. He added that soon after his inauguration on January 20 he would appoint one person to handle the NAFTA and other U.S.-Mexican issues. Dozens of protesters assembled outside the Texas Governor's Mansion, where the meeting was taking place. They shouted, "No free trade" and held a banner reading, "NAFTA: Bush's Corporate Give-away." Mary Ann Neely, director of Clean Water Action, called on Clinton to make drastic changes to the text. The NAFTA text "is not a good document right now," said Neely. "It's not good for business. It's not good for labor. It's not good for the environment. It's not good for the health and safety of the people of the United States or Mexico, and [Clinton] knows that." Representatives of the Teamsters Union, the Sierra Club and other groups were on hand as well. In addition to NAFTA, Clinton and Salinas discussed border problems such as drug trafficking, illegal immigration and pollution. Clinton said he disagreed with a Supreme Court ruling legitimizing the U.S. kidnapping of a Mexican citizen thought to be involved in the murder of a U.S. drug agent. Source: Mark Langford, "Clinton Promises Salinas Quick Action On Side Agreement," UPI, January 8, 1993; Terence Hunt, AP, January 8, 1993; "Clinton Reaffirms Support for Mexican Trade Pact," REUTER, January 8, 1993. _________________________________________________________ EUROPEAN PARLIAMENT STUDIES NAFTA Mexico will gain from the North American Free Trade Agreement, but Latin American countries may come under new political and economic pressure from the United States as the free trade area offers them few of the total expected benefits, concluded a study conducted by the European Community's Committee on External Economic Relations. The November 18 study said Mexico will gain privileged access to the U.S., -- the world's largest and richest market -- and will attract significant foreign investment, which will lead to significant economic gains. However, the report finds, NAFTA's initial impact on the U.S. economy will be small, and some sectors will probably suffer. The report lists sugar refineries, electronic components manufacturers, fruit and vegetable producers and steel and textile producers, as probable losers under NAFTA. But NAFTA's more significant attraction to the U.S., according to the study, is the political advantage it offers. "An FTA with Mexico is seen in Washington as a means of strengthening democracy and political stability south of the Rio Grande," the report states. NAFTA offers an invaluable launching pad for the creation of a Latin American free trade zone and the stability of democracy in South America. The report says Canada has little to gain from free trade with Mexico, and Canada's participation in NAFTA is simply a defensive attempt to maintain the competitive advantages of the Canada-US Free Trade Agreement. The report examines NAFTA's and other free trade agreement's effects on Europe. The committee concludes the discipline of a GATT accord would be "the most effective way for the European Community to forestall the creation of a US-centered web of free trade agreements in Latin America and Asia." Source: REPORT OF THE COMMITTEE ON EXTERNAL ECONOMIC RELATIONS ON THE FREE TRADE AGREEMENT BETWEEN THE UNITED STATES, CANADA AND MEXICO, November 18, 1992. _________________________________________________________ GATT News Summary _________________________________________________________ US-EC TRYING TO FINISH GATT BEFORE FAST TRACK EXPIRES In a desperate attempt to conclude the Uruguay Round before U.S. fast track negotiating authority expires March 2, officials from the United States and the European Community are holding intense meetings in Geneva. Negotiators have been trying since Friday to establish an outline agreement which they can present to a meeting of senior GATT officials Friday. Under fast track, the U.S. Congress has limited ability to debate and amend the trade accord. GATT supporters contend an expiration of fast track could delay the round by months, or even years. There are many potential obstacles to establishing an outline by next Friday, not the least of which is the U.S. request to reopen negotiations in 25 areas, including anti-dumping and subsidy rules, patent and copyright protection, and establishment of a multilateral trade organization. Source: Frances Williams, "US, EC in Last-Ditch GATT Talks," FINANCIAL TIMES, January 11, 1993, p. 12. _________________________________________________________ Produced by: Kai Mander, The Institute for Agriculture and Trade Policy (IATP) 1313 Fifth Street SE, Suite #303 Minneapolis, MN 55414-1546 USA Telephone:(612)379-5980 Fax:(612)379-5982 E- Mail:kmander@igc.apc.org _________________________________________________________