MR. WILSON: Panelists, thank you for this opportunity to talk about the '99 WTO negotiation and its significance to cattlemen. I'm Ross Wilson, vice president of the Texas Cattle Feeders Association, a trade organization New Mexico. Our members produced and marketed some seven million head of fed cattle last year, or about 30 percent -- in fact, in excess of 30 percent of the nation's fed cattle supply.

Cattlemen appreciate the initiatives -- well, you have my written testimony, so I'm going to abbreviate and cut to the chase and save some time.

Cattlemen appreciate the initiatives that have been undertaken to gain access to international markets and to resolve lingering issues that restrict the ability of the U.S. beef industry to offer its product to international consumers.

Among the strengths of the current WTO system is the well-defined process for initiating a dispute case and for determining the final ruling or settlement. A primary weakness, however, of the current system is the absence of enforcement mechanisms to assure compliance once a ruling is handed down. The integrity and validity of the WTO as a dispute settlement body requires that WTO members promptly comply with recommendations and rulings of the dispute settlement process. The TCFA recommends the -- excuse me. The TCFA commends the Administration and Congress for their aggressive actions in this regard and urges continued coordinated pressure to assure that the EU lives up to its responsibilities. It is time to either shorten the WTO dispute settlement process or provide a mechanism that allows the winning party to be compensated during the time it takes the losing party to implement the compliance actions.

Under the current system, compensation or retaliation only starts when the entire process is completed, but the injured party is not reimbursed for losses incurred during or prior to the case. There is no incentive for early settlement by a losing party because the current system effectively rewards stall and delay tactics.

As far as specifics are concerned, were commend the following points during the '99 negotiations: First, we must maintain current language requiring strict use of science-based trading rules established in the Uruguay Round in the Sanitary and Phytosanitary Agreement. This is critical to the continued expansion of U.S. beef markets -- U.S. beef exports. As you know, the European Union, as recently as last week in Codex meetings in Rome, suggested that social and political considerations be added to the SPS framework. We think that that would lead to nothing more than a continual ad infinitum, ad nauseam, in fact, non-tariff trade barriers that we would never be able to resolve.

Second, we must protect scientifically approved technologies such as GMO's that enhance production efficiency or food safety by establishing transparent science-based rules.

Third, we must negotiate elimination of State Trading Entities and increase access to wholesale and retail trade from importing countries.

And fourth, we must negotiate the continued reduction of tariffs and the expansion of Tariff Rate Quotas; existing duties in key export markets such as Japan and Korea must be reduced significantly. We appreciate the reductions that have taken place to this point in time; we would hope that those would continue aggressively. We must establish a target date for reducing all these tariffs to zero.

We need enforceable global trading rules in place and in use that grant market access, settle disputes based on science, and reduce tariffs. The U.S. must hold its trading partners to commitments agreed to in previous trade agreements or risk losing public support for additional trade negotiation authority.

On a related note, I might add that we strongly support fast-track authority for the President, and the U.S. is -- in essence, has their hands tied behind their back in some of these negotiations that are taking place currently. And that will obviously impact the WTO negotiations.

That completes my remarks and I'll be happy to answer any questions.

MR. GALVIN: Thanks, Ross. It's been good to see you again.

A couple of things. First of all, I agree with many of the things you said about the deficiencies in the current dispute resolution mechanism and I think there are some areas where that can be improved. I should just point out, though, that maybe as bad as the current system is, the fact is that before the WTO was set up, we really didn't have any dispute mechanism at all. So at least I think we have made some progress in just finally having a place where we can, in a sense, you know, take our case to court and try to get things resolved. But I certainly agree that oftentimes these take too long and we ought to look at what we can do to improve the procedure.

MR. WILSON: Tim, I hope you will see in my written comments that we are complimentary of the improvements in the process. We supported GATT, we supported NAFTA; we saw improvements in beef trade as a result of those two negotiating processes that were put in place. We just say that it's time to move forward and make additional improvements in that process. I think you showed in your own slides that the U.S. market is obviously much more open than any of the foreign markets. That's the point I wanted to make.

MR. GALVIN: I appreciate that. Just one specific comment on the hormone case, because I think that really is now coming down the wire. As most people know, the WTO is scheduled to rule by this Monday, the 12th, and that's the deadline for whether or not we can go ahead with the proposed 200 million dollars worth of retaliation that we stated last month. And, you know, that really is kind of the final stop here. And once that decision is made, the intention is to press ahead within a matter of days to actually put in place that retaliation against the Europeans. Because in our view, you know, time has run out, everybody's patience is completely worn out, and it is time to really impose retaliation. So that's really where we're at now on that.

MR. WILSON: Well, and we anticipate a positive decision by the WTO arbitrator and we appreciate that. And we appreciate all the effort that has been expended by the administration and Congress to get to that point. All we would say is it took too long.

MR. GALVIN: Right. I understand.

One final question, if I can. As you may know, within the last several weeks the European Union has made clear that one of their key objectives for the next round is animal welfare. They want to see animal welfare standards put in the WTO. Do you have any early thoughts on that?

MR. WILSON: We would be opposed to those. We think that American producers are doing an outstanding job of taking care of their livestock, and will continue to do that. And as science develops new production techniques, that we will continue to adopt those, not only from a production efficiency point of view, but also an animal comfort, welfare, whatever you want to call it point of view. But to allow the Europeans to dictate what those need to be would be a serious mistake on the part of the United States.

MS. BOMER-LAURITSON: I'd just like to add two comments, and one is on the dispute settlement. I think we're all frustrated, particularly on the part of the EU. But I would like to point out that the time frames established in the Uruguay Round for when a final appeal is decided and implementation was largely at the request of the United States because of our concern about our ability to enact measures through the U.S. Congress in any kind of timely fashion. So as we talk about that, we have to be aware of some of the restraints that we face should we ever have to make changes.

The other comment I would like to make is on the fast-track authority. And, you know, going into the negotiating round and previous negotiating rounds, the President has never had fast-track authority. So we don't see that as tying our hands, at least in the initial phases. Obviously, it will become critical to have that as we get into the negotiations a little bit further, because other countries may be reluctant to start cutting deals with us if they think they're going to also have to negotiate with 535 members of Congress. But I would say going into and leading up to Seattle and probably even the first year of negotiations, we think we can do a credible negotiating job.

MR. WILSON: We just think it's another important tool that you need to have.

MR. GALVIN: And not to pick on the EU again, but, you know, they are the only ones that have drug their feet on these different dispute resolution cases. Everybody else, from the U.S., when we've lost a case, to Japan, you know, others, they've all played by the rules and they've not drug it out. So if there's been one offender, I think it's really pretty clear.

MR. WILSON: Our fear would be is that other countries might learn from their actions. So we just need to try to address some of those weaknesses. Thank you.