World Trade

World trade grew at its fastest rate in four years in 1988 and looks set for record growth this year, the GATT trade body said today. Merchandise trade rose 8.5% last year, equaling the record registered in the boom year of 1984 and surpassing the most optimistic forecasts, the secretariat of the 96-nation General Agreement on Tariffs and Trade said. The rate, which compares with a 5.

The volume of worldwide trade in goods grew by 5% last year and is expected to rise by the same percentage in 1988, according to a new study by the General Agreement on Tariffs and Trade. The study by the international trading body paints a more upbeat picture of the world economy than one issued in February that estimated 4% growth in 1987 and 1988. Five consecutive years of growth have brought the volume of world trade one-quarter above that in 1982, a recession year, the study said.

The United States and 73 other countries launched by consensus Saturday a new round of negotiations on liberalizing world trade, including talks on agriculture, services and investment. Clayton K. Yeutter, President Reagan's special trade representative, said the outcome of the six-day ministerial meeting here was "a major victory for the principles of free and fair trade."

To many Americans, the explanation for last week's fall in the dollar's value was that the U.S. government let it decline to make imports more expensive and exports more competitive. But that's only partly true. Yes, the Federal Reserve allowed the dollar to fall. But it was given tacit permission to do so by the government of Japan. Tokyo told U.S. negotiators in September that it would use its capital to moderate the dollar's fall but not prevent it.

After years of discussion, the U.S. Congress today takes the first step toward deciding the fate of the North American Free Trade Agreement. *The Basics: NAFTA would tie together the economies of the United States, Canada and Mexico by creating a common trading zone stretching from the Yukon to the Yucatan. However, because the United States and Canada have enjoyed a free-trade arrangement since 1989, NAFTA primarily affects trade between the United States and Mexico and Mexico and Canada.

The official birth of the integrated Western European Common Market--12 nations and 340 million inhabitants--is still four years away. Yet the entire world economic system is already experiencing powerful prenatal shocks. This is the beginning of a new era of great trading blocs, with Western Europe becoming unified for the free flow of goods, capital--and people.

The World Trade Center Assn. of Orange County and Cal State Fullerton's School of Business Administration have teamed up to develop a database that will provide high-tech enterprises with timely information on business developments in other countries. More than 1,000 companies worldwide are expected to participate in the database, officials said.

A dozen years ago, a small band of Orange County business executives bought into a big dream. They figured that foreign trade would play a big role in the county's future, and they created a local chapter of an international trade network to help local importers and exporters. Their dream was to build a major complex of offices, conference rooms, exhibit areas, retail shops and hotel rooms, all devoted to one activity--world trade.

Your future prosperity is at stake this weekend in the emergency talks between President Bush and European leaders on the General Agreement on Tariffs and Trade. Almost nobody would believe that, of course. To most people, GATT stands for distant, dull arguments over customs duties--nothing to do with their daily lives. It's an understandable attitude; when the sun is shining we take it for granted. We do the same with GATT, forgetting that nations used to fight wars over trade.

The new World Trade Organization is the international governing authority for the myriad trade rules negotiated by more than 100 nations in Geneva last year. As envisioned by the treaty, global tariffs would be slashed an average of 40%, government subsidies would be reduced and many trade barriers affecting food and other products would vanish. Yet there will remain an alphabet soup of regional trade alliances.