If you thought NAFTA was fun, you're going to love GATT. Within the next two weeks, 116 nations will have to agree on the most ambitious reordering of the world trading system ever attempted. The alternatives are economic stagnation and trade wars as nations and regional blocs resort to protectionism.
The deal-making, the web of competing interests, the political rivalries seen in the U.S. Congress during debate over the North American Free Trade Agreement will be multiplied many times over in the showdown negotiations under the General Agreement on Tariffs and Trade.
Despite the charges and counter-charges sure to come and the extreme tensions that will arise as the unyielding Dec. 15 deadline approaches, there are grounds for optimism. President Clinton's triumph on NAFTA convinced many of our trading partners that he is utterly committed to free trade, that he sees increased commerce as the only solid remedy to the job gap facing nations around the world. Because Mr. Clinton could win on NAFTA, foreign governments are more confident he can push a GATT deal through Congress as well.
Before that stage is reached, however, the United States and France have to paper over deep and emotional disputes. One concerns subsidies for European farmers that deny markets to American agriculture; the other involves France's attempts to limit U.S. film and TV imports. Both are regarded by France as essential to the preservation of its distinctive culture. If these two difficult allies can reach an accord, events will move quickly to the last-minute, last-second deals that always characterize GATT negotiations.
First will come a meeting of the 12-nation European Community. Germany and Britain have warned Paris of a possible breakup of their union if French intransigence blocks GATT and condemns the continent to continuing recession. Provided this hurdle is surmounted this week, delegations from around the globe will converge on Geneva Dec. 8 for one final, hectic week of negotiations.
Franco-American rivalry will be just one part of the mosaic. What will Japan do about letting down the bars to rice imports? What will India do to stop its pirating of U.S. patented pharmaceuticals and other goods? What concessions will textile exporting countries make to prevent their competition from blocking an agreement? How will the U.S. business community, comparatively united on NAFTA, deal with deeper divisions over GATT?
Yet in the end, it is harrowing to think a victory for world trade reforms is not in the offing. The new GATT will go way beyond traditional accords on trade in manufactured goods. It will regulate service industries, agriculture and intellectual property (patents) for the first time, and is calculated to boost economic growth by more than $200 billion over the next decade. GATT must not fail. As Secretary of State Warren Christopher said in Brussels yesterday, "the stakes here are immense."