Washington - U.S. cattle producers expect the White House to outline soon retaliatory measures if the European Union fails to open its market to hormone- treated beef by a May 13 deadline, a top industry aide said.
The United States is already threatening to impose 100-percent tariffs on $520 million worth of EU goods in major dispute over bananas.
Even so, the cattle industry expects President Bill Clinton's administration to put the EU on notice in the next week to 10 days that it faces potential retaliation in the beef case, said Chuck Lambert, senior economist and trade specialist with the National Cattlemen's Beef Association.
Cattlemen point to a letter that former White House Chief of Staff Erskine Bowles sent to congressional leaders last October which outlined the steps the United States would take in deciding which EU goods to target in the banana dispute.
Those steps began with the administration requesting comments on its intention to retaliate if EU did not bring its banana import policies into conformity with two World Trade Organisation rulings by Jan. 1.
That notice was followed in mid-November by an initial list of EU goods that could be targeted. Then, shortly before Christmas, the U.S. Trade Representative's Office published its final list of EU goods subject to the 100- percent duties.
In his letter, Bowles pledged that the administration would “take similarly sequenced actions” in the beef hormone case “if the EU is not in full conformity with its WTO obligations by the established deadline of May 13, 1999.” In the U.S. cattle industry's view, that means sanctions should be ready to go in place on May 14 if the EU does not open its market.
“Our position is we want this thing resolved. The thirteenth is the end of the period,” Lambert said.
The EU's ban on beef produced from cattle injected with artificial growth hormones dates back to 1989. The United States responded back then by imposing duties on some $100 million worth on EU goods, but it dropped those before taking the case to the newly created WTO in January 1996.
The EU lost an initial WTO dispute settlement panel decision on its beef hormone import ban in May 1997 and lost an appeal in January 1998.
Since then, EU officials have insisted they only need to conduct a new risk assessment of hormone-treated beef. The United States says the decisions require the EU to drop its decade-old ban.
While the cattle industry is pushing for strong and swift retaliation, its ultimate goal is still access, Lambert said.
Along those lines, the industry has given the administration the green light to propose labeling U.S.
hormone-treated beef for the EU market, Lambert said.
However, final support for that idea would depend on what the labels say, he added.
“We would entertain any proposals,” Lambert said. “It beats sitting here staring at each other eyeball to eyeball,” waiting for sanctions to go into effect.
Because previous retaliatory duties did not persuade the EU to drop its beef import ban, there has also been some discussion about how to make sanctions “more effective this time around,” Lambert said.
One possibility would be to target goods from one EU country first and then rotate among other the other 14 to spread the pain evenly, he said. When duties were previously imposed in the beef hormone dispute, they fell primarily on Italy. That let other EU countries off the hook, Lambert said.
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