Downing Street Years - Margaret Thatcher [475]
It was scorching hot in Houston — so hot indeed that as heads of government stood watching the opening ceremonies the ever thoughtful and technology conscious Americans arranged for us to have special air conditioning around our feet, blowing up from the ground. President Bush asked me to open the discussion on the economy and, after noting the implications of the collapse of communism, I concentrated on the imminent danger of the collapse of free trade unless the GATT round was successfully completed. I said that it was vital that the world did not relapse into blocs, particularly in trade and monetary matters. That would be a step backwards with damaging economic and political consequences, particularly for the countries which were excluded. We should, in fact, be looking beyond the present GATT round to see how the process of freeing up world trade in goods and services could be continued.
The discussion returned to trade the following day. I now strongly supported Brian Mulroney who argued that the biggest losers if the GATT failed would be the less developed countries (LDCs). I also reminded those present of the huge amounts still being spent by the European Community, the United States and Japan on agricultural support. In fact, the section of the Houston communiqué which dealt with trade constituted the best and toughest statement ever made by the major economies on the subject. The tragedy was that the European Community’s commitment to trade liberalization was only skin deep, as subsequent events were to show.
THE ROME EUROPEAN COUNCIL
I flew into Rome at midday on Saturday 27 October knowing full well that this would be a difficult occasion. But I still did not realize how difficult. This time the excuse for holding an ‘informal’ Council before the formal Council in December was even more transparent than in Paris or Dublin. The idea was allegedly to take stock of preparations for the forthcoming CSCE summit and to discuss relations with the Soviet Union.* In fact, the Italians wanted to pre-empt the outcome of the two IGCs on EMU and political union. Nobody bothered to explain why a special Council was necessary before the IGCs reported.
As always with the Italians, it was difficult throughout to distinguish confusion from guile: but plenty of both was evident. In his ‘bidding letter’ to the Council Sig. Andreotti made no mention of the need to discuss the GATT Uruguay round. I wrote back insisting that if the Community Trade and Agriculture ministers had not reached agreement on the Community offer on agriculture beforehand we must discuss the matter at Rome because time was running out.
More of a clue to the Italians’ intentions was perhaps given by the Italian Foreign minister’s letter which went so far as to suggest a provision for future transfer of powers from member states to the Community without treaty amendment. The Italians gave out — and it was well reported in the press — that they would be taking a moderate line, not pressing for a specific date for the start of Stage 2 of EMU and noting that Britain’s hard ecu proposal must be taken seriously. A long and often contradictory list of proposals on political union had been drawn up by the presidency, including plans for a common foreign policy, extended Community competence, more majority voting, greater powers for the European Parliament and other matters. The precise purpose of this paper remained unclear. What I did not know was that behind the scenes the Italians had agreed with a proposal emanating from Germany and endorsed by Christian Democrat leaders from several European countries at an earlier caucus meeting that the GATT should not be discussed at the Council. Had there been such a discussion, of course, they would have found it more difficult to portray me as the odd one out and themselves as sea-green internationalists.
Chancellor Kohl had spoken publicly of the need to set