US SAYS CANADIAN, ISRAELI PACTS SHOULD SPUR TRADE
Trade Representative Clayton Yeutter
said on Monday that the U.S. free trade agreements with Canada
and Israel should help to pave the way for liberalizing the
global trading system.
    He said the Canadian and Israeli pacts will not set back
worldwide reform efforts under the General Agreement on Tariffs
and Trade (GATT) as some critics feared but help them.
    The GATT talks began a year ago in Punta del Este, Uruguay
to liberalize the global trading system and to include in it
trade in agriculture and services such as banking.
    Yeutter made his remarks at a U.S.-Israeli trade meeting
marking the second year of their bilateral accord. The
Canadian-U.S. pact, signed by two sides two weeks ago, has yet
been approved by the U.S. Congress and Canadian Parliament.
    The two free trade agreements (FTA) would gradually remove
tariffs and other barriers to cross-border trade in goods and
many services.
    Yeutter said in the aftermath of the Canadian and Israeli
pacts "other countries have realized that if they want to
continue to have access to the world's largest market, they had
better get serious about improving the GATT."
    The pact with Israel, he said, is gradually increasing
shipments both ways and the Canadian pact will substantially
increase the gross national products in both countries.
    Yeutter also said the Canadian and Israeli pacts should
serve as important precedents for progress in GATT.
    Yeutter said, "increasing trade is one of the keys to
enhanced political and economic stability around the globe."
    He said, "a stronger GATT will enhance prosperity, not only
for advanced industrial nations, but also for other countries
that need to increase trade in order to better their standards
of living."
    Yeutter added it was important not to risk the progress
made in the Israeli and Canadian trade pacts by resorting to
protectionism.
    He was referring to trade legislation pending in Congress
that would force the United States to take retaliatory actions
against nations with large trade surpluses with the United
States if the countries practiced unfair trade.
    The legislation was prompted by a growing U.S. trade
deficit that hit 156 billion dlrs last year and is still
rising.
    Yeutter said the pressures for Congress to act were hard to
resist, but the pending legislation would undermine President
Reagan's efforts to liberalize the world trade.
    Yeutter renewed the threat of a White House veto.
    He said, "President Reagan will veto any bill that contains
serious flaws, and I believe that veto would be sustained."
 Reuter
