16 



Canadian Wheat Board. 



Does the NAFTA address any of these problems? 



If not, does the Administration plan to address any of these 

 problems through the side agreements? 



A. The agricultural chapter of the NAFTA essentially represents 

 two bilateral agreements — one between the United States and 

 Mexico and the other between Canada and Mexico. There were no 

 discussions between the United States and Canada on any 

 agricultural market access issues. This is primarily because of 

 Canadian reluctance to address these issues in a comprehensive 

 fashion. The NAFTA, therefore, does not address problems in 

 wheat trade across our northern border. Trade in agricultural 

 goods between the United States and Canada will continue to be 

 governed by the rules of the U.S.- Canada Free Trade Agreement. 



Canadian Wheat Board sales of durum wheat into the U.S. market 

 have recently been the subject of high level discussions between 

 U.S. and Canadian officials. We recognize the seriousness of 

 this situation and are committed to dealing with it in a 

 bilateral context. With regard to subsidized exports of Canadian 

 wheat into the Mexican market, the NAFTA does not preclude the 

 United States from countering Canadian subsidies in the Mexican 

 market. 



10. Q. Mr. Ambassador, you've indicated your desire to extend 

 FAST-TRACK and revive the GATT talks. Can you give me some 

 indication as to what direction the Administration plans to take 

 with the GATT talks? 



A. Enclosed are press releases issued by the White House and 

 USTR announcing the President's decision to request an extension 

 of "fast track" authority. Also, we are enclosing the formal 

 proposal which was sent to the Congress on April 27. 



11. Q. Does the Administration plan to push for export subsidy 

 cuts in the EC? 



A. The Uruguay Round agreement on agriculture will include a 

 provision requiring multilateral export subsidy reductions. 

 Assuming the Blair House agreement are formally accepted by 

 Uruguay Round participants, the outcome would be export subsidy 

 reductions of 21 percent in volume and 3 6 percent in expenditure 

 levels over six years. Since the agreed upon base period for 

 export subsidy reductions is 1986-1990 and the current level of 

 EC export subsidies is substantially above the base, the real 

 reduction for the Community from present levels will be 

 substantially more than suggested by the Blair House agreement. 



12. Does the Administration plan to push for further cuts in 

 the EC's internal supports? 



