The trade ministers of the United States, Japan, the European Community and Canada began four days of meetings today to help devise a united western front on a new round of global trade talks.
But the United States may have thrown a wrench into the discussions, designed to be informal and relatively problem-free, by acting earlier than expected on a trade dispute over Japanese high-technology products.
Canadian trade minister James Kelleher, who is host of the meeting, said at a press conference today that he would not comment on actions of other officials.
U.S. Trade Respresentative Clayton Yeutter at an impromptu press conference denied that his action would have any effect on the trade minister's meetings. Sources said Yeutter decided to take the action to investigate trade in semiconductors on the first day of the discussions here to send a strong message to the Japanese.
Although trade problems will be discussed, the main purpose of this meeting is to prepare a consensus of proposals for discussion at the new round of talks for the General Agreement on Tariffs and Trade. Progress on setting up the GATT talks has been marred by the refusal of the French at the seven-nation economic summit this spring to agree to set a date for the new round. Several Third World countries are opposed to the new round because it threatens to open up trade in industries they want to protect.
The developing countries don't want to see trade opened in services, high technology or intellectual property, Kelleher said. The four ministers meeting here are scheduled to discuss how they can make those trade topics more palatable to the Third World, Kelleher said.
Movement toward a new round of trade talks is important in helping to defuse protectionist pressures in Congress, which may explode into the passage of protectionist legislation this fall, trade experts said.
The ministers have divided up eight subjects among themselves for discussions during four days in the picturesque industrial town at the hub of lakes Michigan, Superior and Huron. Its sister city, Sault Ste Marie, Mich., is a brief boat ride away.
Kelleher said the discussions on tariffs and services will be conducted by the EC; subsidizies and investment by the United States; intellectual property and high technology by the Japanese, and dispute settlements and safeguards (the handling of import surges that are not unfairly traded through subsidies or dumping) by Canada. Results of the discussions will be given to officials of the four countries to present with a united front at preparatory GATT meetings, Kelleher said.
The ministers will hold discussions Friday during a train ride to the Agawa Canyon, a wilderness area known for its waterfalls and rocky cliffs. The ministers also are scheduled for a fishing expedition on Saturday. Kelleher conducted the press conference in a polo shirt, pullover sweater and khaki pants to emphasize the casualness of the discussions.
Despite Kelleher's attempts to avoid provocations, several subjects of concern among the four trading groups -- which constitute 60 percent of world trade -- are bound to arise.
One topic will probably be growing protectionism in the U.S. Congress against imports, particularly those from Japan, in light of record U.S. merchandise trade deficits last year of $123.3 billion. U.S. officials have said that they expect the deficit this year to be between $140 billion and $150 billion.
Yeutter will be new to the ministers' meetings, started three years ago by his predecessor, William B. Brock, who is now Labor secretary. Although Yeutter has met Kelleher, he had not met the trade ministers from the EC or Japan, Kelleher said.