U.S. and E.E.C. fail to avert trade war

Press, 21 April 1986, Page 6

U.S. and E.E.C. fail to avert trade war

NZPA-Reuter I Paris Talks in Paris tetween the United States ind the European Economb Community had failed to lift the threat of a bitti- trade war because of Spain’s and Portugual’s erry into the bloc, American and Community officios said yesterday. • “Our meeting as not allowed us to finda solution,” said the Cmmunity’s trade commisioner, Mr Willy De Clerq,’ after talks with the [United States Agriculture'Secretary, Mr Richard Lyng, and the trade representatre, Mr Clayton Yuetter. K

Washington I now planned to curb igricultural imports frtti the Community next ninth in retaliation for thf introduction of E.E.C. lWes on Spanish and Pofuguese imports, Mr Lyng [aid. Washington safe that the levies will costAmeri-

can cereal and oilseed farmers an estimated SUSI billion ($1.82 billion) a year in lost sales and has demanded compensation. From May 1 Portugal is due to reserve 15.5 per cent of its cereals market, previously heavily dominated by the United States, for European suppliers, and to introduce a temporary quota system for oilseeds in place of existing import licences. The E.E.C. says oilseed ■ quotas will be set high enough to do no damage to American exporters and that no loss of cereals markets will occur before 1987.

Mr De Clercq and the Community’s Farm Commissioner, Mr Frans Andriessen, said after the meeting they had renewed an offer to discuss American compensation claims through the General Agreement on Tariffs

and Trade but had rejected Washington demands that the levies be suspended meanwhile. They said that if Washington went ahead with retaliation the Community would respond with its own curbs on American goods after the sevennation Tokyo economic summit meeting in two weeks.

Both sides said the immediate problem was over American oilseed exports to Portugal, where Washington has set an early-May deadline for announcing a list of retaliatory measures.

It has said it will not take action on the loss of Spanish markets until July.

Messrs De Clercq and Andriessen said they had repeated the European Commission’s view that any damage to American farm exports would not emerge before next year,