Schwab says US will not make new WTO offer unilaterally

U.S. Trade Representative Susan Schwab this week said the U.S. would not offer another unilateral proposal in the WTO to reduce its domestic agricultural support, as requested by other members. Such new U.S. concessions would only be pocketed by members, who would not make significant concessions of their own on areas such as agricultural market access, she said.

"Calls for the U.S. to go first? Been there, done that. Bought the T-shirt. Didn't work," Schwab said in an Oct. 3 speech at the American Enterprise Institute for Public Policy Research. She added that while the U.S. is expected to be a leader in the WTO talks, it cannot revive the talks on its own.

Schwab said she remained confident that there could still be a successful outcome to the Doha round. She said the question is the time frame for that conclusion, but insisted President Bush and USTR are committed to getting it done "sooner rather than later, but not on any terms."

There are a number of reasons why concluding the Doha round may be more difficult than concluding previous rounds, Schwab said. She noted the preponderance of developing country groups with different interests, and said the EU's different membership after expanding to 25 countries has also affected the talks. She pointed out that Hungary and Poland previously were in the Cairns group of agricultural exporters.

Schwab also said the "China factor" continues to make a deal tougher because developed and developing countries are worried that market openings could allow them to be overrun by Chinese goods, particularly in the industrial sector.

Schwab acknowledged that it has become more difficult to move trade agreements through Congress by noting the conflicting votes on the Bahrain and Oman FTAs. However, she said House votes on the Oman and Central American Free Trade Agreements, which were approved by 22 and 15 Democrats, did not give a true indication of the number of House Democrats interested in a pro-trade agenda.

Building consensus behind trade votes will require the administration to reach out to Democrats, and Schwab said USTR would do this regardless of the outcome of the Nov. 7 midterm elections.

Schwab declined to say whether an expansion of trade adjustment assistance benefits for workers who lose their jobs due to increased trade could be a part of an effort to renew fast-track authority, which expires in July 2007. The current TAA bill expires in September 2007.

She did indicate that the administration would generally agree to a series of things in order to get negotiating authority, and that she would have to see how discussions with members of Congress go on this issue.

Finance Committee Ranking Member Max Baucus (D-MT) last week said he would favor linking any renewal of fast track next year to a number of measures, including the renewal and expansion of TAA so that it would cover services workers and all aspects of trade displacement (Inside U.S. Trade, Sept. 29, p. 1).