The Relationship between an Evolving GATT and an Evolving European Economic Community
Dunkel, Arthur, Atlantic Economic Journal
The Relationship Between an Evolving GATT and an Evolving European Economic Community
May I first thank the members of the Atlantic Economic Society and the organizers of the Society's Twenty-Ninth International Conference for inviting me to make this address. My theme is the relationship between the work of the Member States of the EEC in forging the Single Market, and the Uruguay Round of multilateral trade negotiations which have now entered their fourth and final year here in Geneva. So I shall be adding the date of "Uruguay Round 1990" to the focus of this conference on "Europe 1992".
Check the calendar of someone involved in trade policy making in the EEC, and you would no doubt find both dates already marked down -- and not only because the Uruguay Round will also conclude in the EEC's home town of Brussels. In fact, many would see significance in the fact that the Round was launched in a developing country -- Uruguay, had its mid-term review in North America -- Canada, and is to end in the European continent where major political and economic evolutions are underway.
1992 will be marked down, of course, as the date for completing the Single Market. The endeavor is to secure the free movement of goods, of services, of capital, and of people. The objective is to create, on this side of the Atlantic, an economic entity which, in many respects, will be comparable to the U.S. Once the Single Market is in place, the EEC will rank next to the U. S. in terms of purchasing power, as one of the two largest markets in the world. And the parallel promises to be even more striking once the further step of monetary union has materialized.
But the Uruguay Round deadline of 1990 is, by no means, less important for the EEC than 1992. The Community's future lies as much in its links with the outside world as in its domestic strengthening. And this is not all. There are striking parallels between the scope and coverage of the Uruguay Round and that of Europe 1992.
II. Parallels Between Uruguay and Europe 1992
Let us first take the free movement of goods. The aim of the Uruguay Round is to further open markets worldwide through increased and predictable market access. Market access negotiations are taking place in unison on a number of fronts, both horizontally and vertically.
Horizontally, it will cover tariffs and non-tariff measures and, particularly significant in my view, also trade-related policy instruments used inside national frontiers. The conditions for effective market access and vigorous international competition are no longer exclusively -- or even primarily -- a question of conventional border restriction.
Vertically, it will focus on particular areas or measures that represent hard-core challenges to more liberal international trade. Agriculture, textiles and clothing, tropical products, and natural resource based products are cases in point. So, too, are the non-GATT conforming unilateral or bilateral arrangements seen in sectors like steel, automobiles, consumer electronics, and semi-conductors.
Another core item on the 1992 agenda is services. The Uruguay Round negotiations are designing a multilateral framework of rules inspired by GATT's basic principles of openness and predictability. Technical work has also begun on the application of such a framework to specific service sectors, such as financial services, insurance, telecommunications, transportation, and professional services. Bear in mind that international trade in services amounts now to about $600 billion, or about one-fifth of the value of trade in goods. Consider also that this trade currently takes place without any of the security that GATT's multilateral rules provide in the area of trade in goods. So, the potential for rapid growth is high.
The free movement of people and the free movement of capital are being specifically addressed in the 1992 program. …