US Outlines Strategy for WTO Decisions

Joe Smith joseph.a.smith at verizon.net
Tue Dec 31 11:00:53 PST 2002


The Bush administration is angry with losing a number of cases before the WTO. One of the the interesting things about the WTO is that the US has less direct influence over the WTO decision-making process than it has at the IMF and the World Bank. It has long seemed that at some point the US would bristle at the idea that they might have to follow policy articulated by the supranational body that runs against accepted definitions of "national interest." Certainly the case of the Bush tarriffs on steel imports raised the spectre of such a clash (global governance vs national interest / empire vs imperialism?). The point of clashing interests seems to be upon us. The administration has just made the remarkable (thinly veiled) threat that ``if the perception develops that WTO panels and the Appellate Body are substituting their own policy judgment for a negotiated balance of rights and obligations, then it will be difficult to maintain the support and confidence of member (countries) and the public." Could it be that the US will be the first country to pull the rug out from under the WTO? Will the unilateralist drive within the Bush administration undercut the WTO?

joe

************************* December 31, 2002

U.S. Outlines Strategy for WTO Decisions By REUTERS

Filed at 1:18 p.m. ET NY Times

WASHINGTON (Reuters) - The Bush administration on Tuesday outlined its strategy for dealing with World Trade Organization rulings that have eroded the United States' ability to impose import restrictions on products ranging from lamb meat to steel.

Angered by a series of decisions against U.S. anti-dumping and other ``trade remedy'' laws, Congress gave the Bush administration until the end of 2002 to come up with a plan to reverse that trend and maintain the United States' ability to act against what it determines are unfairly traded imports.

The demand reflected the strong view of outgoing Senate Finance Committee Chairman Max Baucus, a Montana Democrat, and many other lawmakers that WTO dispute settlement panels have overstepped their bounds by imposing obligations on the United States that do not exist in WTO rules.

Baucus and the other lawmakers argue the WTO dispute panel rulings upset the careful balance of trade concessions that the United States and other countries negotiated in the 1994 Uruguay Round trade agreement that created the WTO.

In its report, the Bush administration took pains to note that the United States has generally benefited from the WTO dispute settlement system, which has handled more than 275 cases since its inception seven years ago.

But the administration made clear it shared the view that some panels have gone too far in some rulings and warned that could jeopardize support for the WTO.

``If the perception develops that WTO panels and theAppellate Body are substituting their own policy judgment for a negotiated balance of rights and obligations, then it will be difficult to maintain the support and confidence of member (countries) and the public,'' the report said.

The administration said it would press the issue in current world trade talks, where rules governing the WTO dispute settlement process and the implementation of anti-dumping and other trade remedy measures are under review.

The United States also will assert itself in individual cases now pending at the WTO to prevent further erosion of its ability to impose trade remedy measures, the report said.

The Bush administration said it has had some success on that front recently in a case involving U.S. duties on German steel. A WTO appellate panel reverse an earlier ruling that United States said imposed an obligation not in WTO rules.

However, the key test of the administration's effort in that area could come next spring, when the WTO is expected to issue its preliminary ruling on President Bush's decision in March to slap tariffs of up to 30 percent on steel imports to help struggling U.S. companies get back on their feet.

Bush imposed those duties under ``safeguard'' provisions of WTO rules, which allows countries to take action against a surge in imports that is threatening a domestic industry.

They are a different category of protection than anti-dumping and countervailing duties, which are imposed in response to allegedly unfair trade.

In its report, the Bush administration chided the WTO for its rulings on three other U.S. safeguard actions involving lamb meat, wheat gluten and steel line pipe.

In those cases, the WTO appellate panel ruled against the United States, based partly on its view that safeguard tariffs were ``extraordinary'' measures and therefore required a more rigorous justification than the United States supplied.

However, the term ``extraordinary'' appears nowhere in the WTO Safeguards Agreement or in other relevant provisions of the 1994 Uruguay Round trade pact, the Bush administration said.

http://www.nytimes.com/reuters/business/business-trade-wto-usa.html



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