EU is risking new tariffs, U.S. warns

DUBLIN, Ireland -- The European Union's refusal to accept North American beef is jeopardizing the integrity of world trade law and will lead to retaliatory sanctions, U.S. Agriculture Secretary Dan Glickman warned yesterday.

But European Union Agriculture Commissioner Franz Fischler, speaking after Glickman to 600 delegates at the World Meat Congress, insisted that hormonally treated U.S. beef "does threaten human health," so the EU ban could not be lifted.

The 15-nation union has ignored a World Trade Organization ruling requiring it immediately to lift its 10-year-old ban on the hormone-treated beef from America and Canada.

U.S. officials warn they will retaliate with $202 million in extra tariffs on EU imports when the arbitration deadline expires June 3.

"In order for the WTO to work, its members have to respect its institutional authority. But in choosing to maintain its ban on beef from hormone-treated cattle, in my judgment the EU has put all this at risk," Glickman said.

People should be skeptical about new food products but should not "allow skepticism to evolve into complete denial," he said.

The WTO plans to hold its ministerial conference in Seattle late this year.

In their speeches, Glickman and Fischler offered minor possible concessions. Glickman said that America might allow its beef exports to Europe to be labeled hormone-treated, while Fischler said the EU could organize a conference of U.S. and European scientists to agree on whether hormones pose a risk.

Privately, however, both U.S. and EU officials said any significant shift was unlikely.

This three-day conference of meat officials from 30 countries provided a rallying point for those trying to persuade others to lower their barriers to meat imports.

Peter Lacy, American director of the International Policy Council on Agriculture and Food Trade, said many countries had exploited fears caused by outbreaks of Bovine Spongiform Encephalopathy in the United Kingdom and E. coli bacteria in the United States and Japan.

"Sanitary arguments today are more and more used as a means of trade protectionism," Lacy said.

"I am well aware that beef producers in some countries see this ban as a measure to exclude beef imports from the EU," Fischler responded. "There is no ulterior motive to this measure but the protection of human health."

In other WTO-related developments yesterday:

U.S. Trade Representative Charlene Barshefsky said the United States and China will resume talks "soon" on China's entry to the World Trade Organization, ending an impasse that began with the U.S. bombing of China's embassy in Yugoslavia.

"We are in contact with the Chinese, and we will soon be setting a date for resumption" of the talks, Barshefsky said during an interview with CNBC television. China still wants to join the Geneva-based trade body this year and "that necessarily means a negotiating schedule that resumes in the not-too-distant future," she said.

U.S. companies from General Electric Co. to The Boeing Co. to Caterpillar Inc. have been pushing the Clinton administration to finish the negotiations, which would force open Chinese markets and allow the companies do business there with the same freedom with which Chinese companies do business in the United States.

An agreement would also encourage foreign investment in China and give Premier Zhu Rongji's economic reform program more legitimacy at a time when he is under fire for closing money-losing state-run enterprises and putting thousands of people out of work.

Robert Cassidy, the chief U.S. negotiator on China trade issues, had been scheduled to travel to Beijing this month but the trip was canceled after the bombing.

The WTO negotiations have dragged on more than 13 years and came close to concluding in April when Zhu visited Washington.

Efforts to appoint a new leader for the World Trade Organization are going nowhere fast.

Three weeks after Italy's Renato Ruggiero stepped down as director-general of the trade body, the nations are no closer to selecting a successor.

And some fear that the 134 member nations are so deadlocked over two candidates that they will have to start anew to find someone, possibly delaying a decision for months.

Although the director-general is in part a figurehead, the WTO chief also plays an important behind-the-scenes role in setting the trade agenda and seeking to solve some tough disputes. Ruggiero intervened in a nasty fight between the United States and European Union over trade in bananas.

The two candidates for the top job are former New Zealand Premier Mike Moore and Thai Deputy Premier Supachai Panitchpakdi, both of whom are considered highly qualified.

So far, there are no formal proposals for a third candidate to break the deadlock, although names floating around the WTO's lakeside headquarters include former Uruguayan trade minister Enrique Iglesias, who heads the Inter-American Development Bank in Washington. Because of the stalemate, a planned meeting yesterday of the WTO's decision-making council was scrapped.

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