AGRICULTURAL TRADE IN THE URUGUAY ROUND: INTO FINAL BATTLE

Some type of framework agreement in Services is also vital,
largely due to the substantial interests of the American financial
community.

The remaining three areas of vital importance are Trade-Related
Investment Measures (TRIMS); Trade in Intellectual Property
(TRIPS); and the negotiations on Subsidies. It is beyond the scope of
this paper to discuss these areas, each of which would require treat-
ments of similar length.

The Bilateral Front

Despite the emphasis on multilateral negotiations, a large share of
negotiating gets done in capitals. Several examples are illustrative of
the importance of this bilateral front.

In agriculture, an important issue with Europe has been the con-
tinuing dispute over beef hormones. On January 1, 1989, the Euro-
pean Community announced a ban on all U.S. beef imports contain-
ing hormones used to increase cattle growth. Citing health risks, the
EC action touched off a cycle of retaliation that has affected the
world trading system (Bredahl).

Growing Role of Nontariff Import Barriers

This apparently isolated example of health regulations acting as
trade barriers is part of an emerging pattern of environmental and
health issues with major consequences for world trade. The larger
significance of the hormones dispute relates to the growing role of
nontariff import barriers, especially justified on health, safety and
environmental grounds. As noted above, the temptation to use such
sanitary and phytosanitary restrictions is increasing for a variety of
reasons.

In the high income countries of Europe and North America,
health, safety and environmental regulations are especially attrac-
tive candidates for use as nontariff barriers. They are part of a
larger problem: environmental and health risks are increasingly
traded among nations along with goods and services.

Risks of Disservices Slighted

While increasing emphasis is given to the growing role of services
trade, comparatively little has been directed to risks that are the op-
posite of services: environmental and health disservices traded
across national borders. This problem arises directly from the trans-
fer of technology and will increasingly affect international invest-
ment flows, product liability, trade and development and the relative
competitiveness of U.S. business (Runge, 1990).

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