TRADE NEWS BULLETIN Volume II Number 4 Thursday, January 7, 1993 _________________________________________________________ USTR NOMINEE KANTOR INEXPERIENCED IN TRADE Last month, President-elect Bill Clinton chose his campaign chairman and long-time advisor Mickey Kantor for the post of United States Trade Representative (USTR). Because Kantor is a novice in international trade matters, some analysts suggest trade may not be a high priority in the Clinton Administration. Furthermore, Clinton's failure to include the USTR in the group of foreign policy appointments announced in early December will, according to the JOURNAL OF COMMERCE, surely lead to speculation the appointment is merely a political payback to Kantor. Others contend Kantor's background as a lawyer and his lack of a previously established position on trade will enable him to negotiate trade agreements that satisfy diverse groups. But U.S. businesses, many of which are eager for completion of GATT and NAFTA accords, reacted with disappointment at Kantor's nomination. They are confused about Kantor's trade positions, and they worry that well- publicized conflicts with other Clinton advisers may hamper Kantor's effectiveness. Opponents of GATT and NAFTA are not any happier. Many had hoped Clinton would choose a USTR more in touch with environmental, labor and agriculture concerns and they are uneasy about Kantor's close connections to corporate interests. Kantor has lobbied for some of the United States' largest corporations, including Philip Morris, General Electric, Occidental Petroleum, Martin Marietta and Atlantic Richfield. Besides inheriting stalled GATT talks and the onus of establishing supplemental agreements to NAFTA, Kantor will have a host of other issues to address, including possible trade conflicts on steel and spiraling U.S. trade deficits with Japan and China. Meanwhile, Clinton is close to naming three deputy U.S. trade representatives and the general counsel for the trade representative's office. Among those under consideration, according to sources, are Rufus Yerxa, the current deputy trade representative to GATT, Michael Wessel, a trade adviser to House Majority Leader Richard Gephardt (D-Missouri) and Barry Carter, trade director for the transition team. Clinton is expected to name Laurence Summers, the chief economist at the World Bank, as undersecretary of the Treasury. Summers would oversee international economic issues for the administration. Source: John Maggs, "USTR Post Low on Clinton List," JOURNAL OF COMMERCE, December 28, 1992; Nancy Dunne, "US Trade Groups Puzzled by Selection of Kantor," FINANCIAL TIMES, December 30, 1992; Stuart Auerbach, "Kantor's Trade Slate Is a Blank; Clinton Selects Envoy for Negotiating Skills," WASHINGTON POST, December 29, 1992; Andrea Shalal-Esa, "Kantor Is Political Insider with Strong Corporate Ties," REUTER, December 24, 1992; Gerald F. Seib, Michael K. Frisby, "Clinton Is Close to Naming Key Aides for Economic and Foreign Policy Posts," WALL STREET JOURNAL, January 5, 1993; "World Bank's Summers Likely to Get Treasury Post," WALL STREET JOURNAL, January 7, 1993, p. B3. _________________________________________________________ GATT News Summary _________________________________________________________ US WANTS EC CONCESSIONS IN AUDIO-VISUAL TRADE The United States is pushing for significant concessions from the European Community in audio-visual services as part of a new General Agreement on Tariffs and Trade (GATT). The U.S. film and television industries are eager to open Europe's $30 billion market, but Europeans say they do not want their culture dominated by the United States. "The overwhelming problem is that in the US, audio-visual services are seen in purely commercial terms," an EC official complained. "In the EC, the economic aspect is seen as much less important, and it is seen in cultural and political terms." Because U.S. films already account for 70 percent of movie attendance in Europe, compared to 20 percent for local film makers, U.S. negotiators are particularly interested in prying open the television industry. EC nations currently set aside a minimum of 50 percent of their television programming to local production. Japan supports the U.S. position because some Japanese companies control financial interests in some of the largest U.S. film makers. But others, such as Australia and India, are equally concerned that an opening of audio-visual markets would destroy domestic industries. The U.S. film and television industry is larger than the industries of the EC member nations combined. Source: David Dodwell, "US Film Makers Focus on GATT," FINANCIAL TIMES, January 7, 1993, p. 4. _________________________________________________________ SELF-SUFFICIENCY IN JAPAN DECLINING Although Japan has thus far refused to open its rice markets to foreign imports, the country's food self-sufficiency is on the downfall as imports of other food products increase, the Agriculture Ministry reported recently. The country's food self-sufficiency rate on a calorie basis fell from 47 percent in 1991 to 46 percent in 1992. Rice accounts for 26 percent of the country's annual calorie intake for the average Japanese. Rice exporting nations want Japan to open its markets to foreign rice as part of GATT. Source: "Japan's Self-Sufficiency in Food Declines," REUTER, December 28, 1992. _________________________________________________________ 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 _________________________________________________________