EC OFFICIAL FAULTS U.S. TRADE BILL

  Sir Roy Denman, Head of the EC
  Delegation in Washington, said pending U.S. trade legislation
  is a misguided attempt to deal with the nation's trade deficit
  and will spark retaliation if passed in its present form.
      "To think that you can deal with a trade deficit by
  legislation is a mistake," he told the Foreign Trade
  Association here.
      Denman told reporters that possible retaliation, which he
  warned of in a letter to House Ways and Means Committee
  Chairman Dan Rostenkowski, would not necessarily be on a
  product-for-product basis.
      "Retaliation does not have to be matched product to
  product," Denman said.
      He said in the case of textiles import restrictions,
  however, retaliation would be against U.S. textile exports.
      "Certainly, if restrictions were imposed on European
  exports of textiles to the U.S., the Community would be likely
  to retaliate with restrictions on U.S. textile exports to
  Europe," Denman said.
      He also took exception to U.S. proposals to require
  countries with large current account surpluses with the U.S. to
  cut those surpluses or face special tariffs.
      "This would conflict with international obligations, throw
  a large wrench into the current round of trade negotiations and
  could easily boomerang," he warned of the tariff proposals.
      Denman also took exception to U.S. efforts to seek
  reciprocity in specific trade sectors.
      "Forcing reciprocity in one sector by imposing barriers
  would simply lead to retaliation from the other party," he
  said, adding that overall reciprocity can only be achieved by
  trading off disadvantages in one sector for advantages in
  another.
  

