US embassy cable - 04ROME568

UNCLAS  ROME 000568 
 
SIPDIS 
 
 
SENSITIVE 
 
STATE PASS USTR 
GENEVA FOR USTR 
 
E.O. 12958: N/A 
TAGS: ETRD, IT, WTO 
SUBJECT: ITALIAN VIEWS ON PROSPECTS FOR WTO TALKS IN 2004 
 
REF: STATE 6662 
 
1. (SBU) Summary.  Following the European Commission's lead, 
the GOI generally agrees with USTR Zoellick's initiative, as 
expressed in his January 11 letter to trade ministers, to 
ensure that 2004 not be a lost year for trade negotiations. 
However, Italy was disappointed that the letter made no 
mention of geographic indications. While Italian trade 
officials agree that market access is a crucial pillar of the 
WTO talks, they believe Zoellick's letter underestimated the 
importance of trade facilitation. The GOI is pessimistic that 
progress can be made in the services negotiations pending 
meaningful offers from significantly more members.  Foreign 
Trade Vice Minister Urso views as highly unlikely the 
prospect for a WTO ministerial this year. End summary. 
 
2. (U) On February 4 Amedeo Teti, Director General for 
Commercial Agreements in the Ministry of Productive 
Activities (Foreign Trade Division), accompanied by the 
Ministry's WTO office director Sandro Fanella and WTO 
Services expert Stefano Santacroce, provided GOI prospective 
on USTR Zoellick's letter on the Doha Development Round (DDR) 
in a meeting with Ecmin and econoffs. Econoff met separately 
on Feb. 13 with the Ministry's Technical Secretariat Chief 
Federico Eichberg (a close advisor to Vice Minister Adolfo 
Urso). 
 
3. (SBU) Echoing EC Trade Commissioner Lamy, Teti told us 
that the GOI was generally happy with the content of 
Zoellick's letter. However, Teti and his colleagues pointed 
out several areas of the DDR that they believe received 
insufficient attention in the letter, including trade 
facilitation, geographical indications, and the current state 
of services offers. 
 
4. (SBU) While recognizing the importance of market access 
issues to the success of the DDR, Fanella expressed some 
concern that Zoellick's letter overemphasized such attention 
to the detriment of other components of the Doha Round. He 
noted particular disappointment that the letter paid little 
attention to rules issues, especially the "Singapore Issue" 
of trade facilitation, which, he noted, remains a key EU 
concern. 
 
5. (SBU) Teti and Fanella said there is also concern among 
some EU member states that Zoellick's emphasis on the 
complete elimination of export subsidies for agricultural 
products moves the U.S. away from the common ground reached 
just before the Cancun ministerial (in the August 2003 
U.S.-EU framework on agriculture). The GOI would have 
preferred a more nuanced approach on export subsidies from 
the U.S., in order to prevent EU hard-liners on subsidies 
(Fanella named France and Ireland) from using a seemingly 
inflexible U.S. position to put up roadblocks.  Fanella added 
that Italy was not particularly concerned about the U.S. 
position, just its potentially negative effect on the EU's 
ability to reach a cohesive position for further negotiations 
on agriculture. 
 
6. (SBU) Teti noted GOI disappointment that Zoellick made no 
reference in his letter to geographical indications (GIs), a 
topic of enduring interest to Italy.  Teti suggested that, in 
the realm of intellectual property, GIs were generally more 
recognized by many developing countries as warranting 
protection, compared to areas of special concern to the U.S. 
such as audiovisual products and computer software.  He 
argued that strengthened GI protection within the WTO 
context, once implemented in the developing world, could help 
effect a gradual shift in opinion towards the usefulness of 
IPR protection in general. Teti suggested that the U.S. and 
the EU seek points in common that would enable them to merge 
their focus in these two areas of IPR protection, with the 
goal of expanding awareness of the need to protect IPR. 
 
7. (SBU) Teti expanded on the theme of potential U.S.-EU 
collaboration on GIs by suggesting the negotiation of a 
bilateral agreement similar to the one the EU reached with 
Canada in 2003.  He admitted, however, that a similar 
agreement with Australia, a decade ago, no longer seemed very 
effective, given increasing Australian resistance to the EU's 
position on GI protection through the WTO. Nevertheless, Teti 
suggested such an accord could prove a useful tool should the 
U.S. and the EU decide on a joint approach to IPR protection 
in the developing world.  Fanella added that any such 
 
negotiation would need to fold in the ongoing, and still 
unresolved, U.S.-EU wine negotiations. (Neither Teti nor 
Fanella suggested that this idea was under serious 
consideration by the European Commission.) 
 
8. (SBU) Eichberg told us the GOI would have preferred that 
the EC not have expressed so directly its willingness to be 
flexible on GI protection in the course of WTO negotiations. 
Nevertheless, he said the GOI was generally satisfied by the 
EC's continued commitment to pursuing enhanced GI protection 
in the WTO.  Still, the GOI will keep close watch this year 
on the EC to ensure it maintains this commitment. 
 
9. (SBU) Santacroce noted GOI agreement with Zoellick on the 
importance of the services sector to the overall goal of 
expanding market access. However, the GOI is concerned about 
moving forward now on services negotiations, given that only 
forty countries have tabled offers. Many of those cannot be 
considered meaningful proposals (Santacroce specifically 
pointed out India). He expressed concern that attempting 
progress on services without significantly more meaningful 
offers could lead to the less-than-ideal creation of a dual 
track process. 
 
Comments of Foreign Trade Vice Minister Urso 
-------------------------------------------- 
 
10. (SBU) In a meeting with the Ambassador on February 12 
that focused principally on Italian participation in Iraqi 
reconstruction (to be reported septel), Vice Minister Urso 
said the GOI appreciated the positive and ambitious approach 
outlined in Zoellick's letter. He also welcomed positive 
developments that had taken place at this week's WTO General 
Council meeting to reinvigorate negotiations. However, he was 
not optimistic that a successful WTO ministerial could take 
place this year given the imminent departure of both Lamy and 
Zoellick, and suggested that WTO members should aim for a 
meeting in early 2005 that would be removed from the 
influence of electoral politics in the U.S. and the EU. 
 
11. (SBU) Comment: Not surprisingly, the GOI's take on 
Zoellick's letter varies little from the EC's generally 
positive reaction.  GI protection remains an exception to the 
GOI's general passivity on trade, though Teti's suggested 
linking of the EU's GI concerns with U.S. concerns on IPR 
does not appear to be more than an Italian fantasy at this 
point.  Italy instead seems resigned to making sure the EC 
does not give away the store by agreeing to an excessively 
"flexible" position on GIs in order to satisfy the other 
concerns of more vocal EU member states. End comment. 
SEMBLER 
 
 
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 2004ROME00568 - Classification: UNCLASSIFIED