The Common Market yesterday voiced its displeasure at the failure of the United States to extend the waiver of countervailing duties on subsidized imports, but indicated it would not use the failure as an excuse to tie up the current round of trade negotiations.
The foreign ministers of the Common Market nations warned that because of the failure of the U.S. Congress to extend President Carter's authority to waive the duties, it was doubtful the Geneva trade talks could be concluded this year. The current waiver authority expires Jan. 3.
The foreign ministers, after a meeting here, also repeated an early warning that failure to resolve the duty question could trigger a major trade war. The Europeans claim the imposition of countervailing duties on subsidized products could cost millions of dollars in exports.
In the United States, Rep. Charles Vanik (D., Ohio), chairman of the trade subcommittee of the House Ways and Means Committee, sent a letter to Robert Strauss, the special U.S. trade representative, predicting extension of the waiver authority early next year.
Vanik noted that both the House and the Senate had approved slightly different versions of a waiver authority extension in the last days of the current Congress. He said this was an indication Congress was prepared to extend the authority.
The Common Market ministers were also openly dismayed at last Saturday's move by Congress to exempt textiles from the trade liberalization negotiations that are the aim of the Geneva talks. The Congressional move on textiles would "leave a totally unbalanced situation as between the textile tariff arrangements of the United States and those of the European community," warned British Trade Minister Edmund Dell, who arrived here yesterday fresh from talks held in Washington Monday with Strauss and Treasury Secretary Michael Blumenthal.
The Common Market "regrets the decisions taken in Congress," according to a statement made by German Minister Klaus Von Dohnanyi, who also endorsed an EEC commission statement made in Brussels Monday that "the Tokyo Round negotiations cannot be concluded in November as we had hoped."
But conclusion of the Geneva tradt talks is bound to be much farther off. In the words of Dohnanyi, "It is indispensable that the American Congress assured the application of the waiver beyond doubt." This, it is recognized here, cannot be accomplished before Congress reconvenes on Jan. 15. Ominously enough, this date is itself almost two weeks after the normal resumption of automatic American countervail action.
Further outspoken criticism came from Dell, who warned "there can be no conclusion to these (Geneva) talks while the threat of countervailing duties under existing American laws continues." The British minister added in a further gripe that existing U.S. laws on countervailing duties were contrary to international trading rules established by the General Agreement on Tariffs and Trade (GATT) in Geneva, implying that they had to be reformed.
Into this climate of diplomatic recrimination the Common Market yesterday threw its commitment to continue "preparing" for the conclusion of the Tokyo Round talks "despite the grave decisions taken in Congress." But these must include textiles, say German diplomatic sources here - a position even more vigorously backed by the Common Market's real hard-liners on trade policy, France and Britain.
For Britain, even the existing concessions on textiles proposed by the U.S. government, and which may now have to be revised following the congressional move, are "minimal," according to Dell.