
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, December 14, 1993                   TAG: 9312140075
SECTION: BUSINESS                    PAGE: B-6   EDITION: METRO 
SOURCE: By DIRK BEVERIDGE ASSOCIATED PRESS
DATELINE: GENEVA                                LENGTH: Medium

GATT: FIRST, THE PAIN

In global trade talks jokingly dubbed the "General Agreement to Talk and Talk," it may seem as if negotiators have done little more than . . . talk.

As trade gurus in their business suits emerge from meetings, they talk of a crisis a minute in discussions on such obtuse topics as tariffication, multifiber arrangements and anti-dumping. It all understandably flies over the heads of most people.

But bureaucratic rhetoric aside, a new General Agreement on Tariffs and Trade will have a profound economic impact on millions of people around the world.

For many, a new GATT accord will make paychecks go further, as the price of imported goods falls along with customs duties.

The package promises eventually to boost the world economy more than $200 billion a year by slashing these taxes on foreign products and otherwise opening international markets.

But for thousands or even millions of people, there will be no paychecks, because their jobs will be exported to other countries, where the work can be done more cheaply.

One of the near-term pitfalls of GATT, economists say, will be an increased burden on the welfare systems of many nations that find farmers, factory workers and others displaced as jobs are shuffled from country to country.

A new blueprint for global trading would be difficult under any circumstances, but this week's deadline for a new GATT accord, after seven years of tough talks, comes at a particularly awkward time. As the world struggles to recover from the longest recession since the 1930s, politicians are forced to negotiate with extra caution.

But average people do stand to gain from GATT.

Some of the most vocal opponents of GATT have been France's 1 million farmers, who burn tires and block roads to protest the prospective loss of government crop subsidies.

And under arrangements that offer drug companies stronger protection for their patents, people in India could end up paying more for medicine.

True, India will gain jobs as it gets clearance to sell more clothing to the developed world - but that in turn bodes poorly for U.S. shirt makers, who could find themselves lining up for unemployment benefits.

Such concerns will make GATT a hard sell for Congress, which just fought a tough battle over a much narrower free trade agreement among the United States, Canada and Mexico.

But even though the final stages of GATT negotiations seemed to please nobody, economists said the package will be good.

At Lloyds Bank PLC in London, chief economist Patrick Foley published a study Monday that predicted a new GATT deal will drive down inflation in industrialized countries while promoting economic growth.

The changes brought by GATT will occur at different times in different countries, he said, but the overall impact will be "very good for non-inflationary growth."

by CNB