Global Policy Forum

By Bruce Ramsey

Japan wants the United States to abandon its first-to-invent patent system and adopt first-to-file. South Korea wants a scaling-back of U.S. anti-dumping laws. Kenya wants a quick end to U.S. apparel quotas scheduled to end anyway in 2005. The European Union has gamely suggested that the WTO consider rules for the humane treatment of farm animals.

With less than four months before the World Trade Organization meets in Seattle, governments are jockeying to set the trade agenda into the 21st century. The main purpose of the meeting here Nov. 30-Dec. 3 will be to set that agenda for a "Seattle Round" of talks to be carried out later.

Some countries, such as India, Pakistan, Egypt and Malaysia, are still objecting to a new round. They would rather talk about how to fix the previous agreement than tackle new subjects. But the big trading nations all want a new round, and it is likely there will be one. Governments are now filing documents at the WTO to argue what should be on the table in Seattle: The rights of labor? The environment? Anti-dumping? The property rights of investors?

Farm products (if not animals) are sure to be on the agenda. The world's food exporters want markets open. Most aggressive are the 14 countries of the Cairns Group, including Australia, Canada, Argentina, Thailand and South Africa.

The United States agrees with these countries on subsidies for farm exports, aiming to "completely eliminate" them. It adds, however, that "governments have a right to support farmers" as long as it's done with "minimal distortions to production and trade." Says a U.S. trade official: "That means if you want to write your farmer a check, fine; but don't tell him to plant soybeans instead of corn."

Reaching agreement on farm trade will take years. And that shapes a second debate, which is whether a Seattle Round should deal with everything in one package or do it in pieces. The Cairns Group, worried that agriculture will be left out, wants one package. The United States, afraid that talks will drag on, wants to do the easy parts first.

A few deals could actually be done in Seattle. The United States would like a deal on "transparency" (disclosure and anti-bribery) in government procurement. It would also like to extend an agreement not to tax products over the Internet.

Labor and environment are relatively new issues for the WTO. Some industrial countries, including the United States, have been pressing for recognition of "core" labor standards such as the right to organize unions. Already the WTO allows countries to ban the import of goods made by prison labor. If the WTO adopted core labor standards, it might be OK to ban the import of goods made by workers forbidden to join unions.

At the 1996 WTO meeting in Singapore, the rich countries won a statement that labor standards are important. But the poorer countries won a statement that setting labor standards is none of the WTO's business. "There will be no more talk of labor standards in the WTO," declared Malaysia's minister of trade and industry, Rafidah Aziz. There is still talk -- and resistance. Kenya said July 5 that it sees labor standards as a way for the rich countries to "hit the developing countries in the products where they have a competitive advantage." Kenya said that it does not want to discuss core labor standards "in any WTO forum."

Environmental protection is a similar issue in that putting it in trade agreements is also a proposal of industrial countries. Switzerland, for example, argues that the WTO needs to "ensure that further trade liberalization also reflects legitimate environmental concerns." Kenya rejects that. "To impose in low-income developing countries environmental standards prevailing in advanced countries," it writes, "would extinguish their comparative advantage."

The property rights of foreign investors is another possible new subject for trade talks. This appeals to a business constituency, and it has inflamed critics. One idea is that foreign direct investors be treated the same as locals. Today, many countries require that foreigners create a certain number of jobs, share technology or develop exports. Several exporters of capital -- Switzerland, South Korea, Japan and Hong Kong -- want to limit such "performance requirements," or at least make them clear up front, and allow investment disputes to be settled at the WTO. The United States is not backing this idea.

Poor countries are asking for a lot more measures that apply only to them. At a meeting in Sun City, South Africa, in June, a working group of 48 "least developed countries" proposed that their exports be exempted from rich-country anti-dumping actions and that they be able to bring anti-dumping actions against rich-country products more easily.

"Special and deferential" is so common a request for unique treatment in WTO documents it has been shortened to "S&D." Everybody, it seems, is for S&D, but the question is what S&D. Europe, for example, does not endorse a Kenyan proposal that rich countries ban farm subsidies.

Says the U.S. official, "There's a lot of put-your-hand-on-your-heart and saying that you're for helping the developing countries."

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