and provides technical assistance in trade and development to developing countries.

Plenary sessions of the Conference are held every 4 years to discuss policies, review past work and set new work programs. The next session of the Conference, UNCTAD VIII, meets in Cartagena, Colombia, in February 1992. Between Conference sessions, the Trade and Development Board (TDB) meets semiannually to carry out the functions of the Conference. UNCTAD reports directly to the UN General Assembly.

Much of UNCTAD's bias towards the New International Economic Order has dissipated since the 1970s as developing countries, recognizing the primacy of domestic policies in economic development, have increasingly adopted market-oriented reforms and undertaken structural adjustment programs to stimulate economic growth. At recent UNCTAD meetings, there has been a clear emphasis on the responsibility each country has for its own development. UNCTAD members have declared their desire to put aside old confrontations, and work together in a cooperative new partnership for development.

At its meeting in September the TDB considered a wide variety of issues dealing with trade and finances for development. Broad trends in direct foreign investment, bank financing and other developments in financial flows were discussed during an examination of the Secretariat's annual Trade and Development Report. Progress made under the international debt strategy was highlighted. Plans were made for UNCTAD VIII and background documents were discussed.

General Agreement on Tariffs and Trade

The General Agreement on Tariffs and Trade (GATT) entered into force in 1948 and the United States has been a party to GATT since its inception. By the end of 1991, 103 countries and customs territories, accounting for more than four-fifths of world trade, were members. An additional 29 governments maintain de facto "application" of the GATT, and there are 23 observers, 6 of whom have applications for contracting party status. GATT is considered an autonomous body, although it was created at a UN-sponsored conference and cooperates with UN organizations, e.g., GATT Contracting Parties and UNCTAD jointly operate an International Trade Center to assist developing countries in promoting exports.

GATT is the principal multilateral instrument through which the United States seeks to improve the world trading system. It is both a compact of rules (rights and obligations) and a forum in

which negotiations and other trade discussions take place. GATT is also intended to play a major role in settlement of trade disagreements between member countries.

International trade has grown dramatically in volume (over 32-fold), importance and complexity, since the inception of the GATT. This growth is due in part to the consensus embodied in the agreement that the world's economic welfare depends on freer trade, without the risk of escalating tariff wars. Seven rounds of multilateral negotiations under the GATT have succeeded in reducing average tariffs in the industrial countries from over 40 percent to less than 5 percent today.

The Uruguay Round

The eighth and current multilateral round of trade negotiations under GATT auspices was launched in September 1986 at Punta del Este, Uruguay. The Uruguay Round is the most comprehensive multilateral trade negotiation to date. Successful completion of the Round is a key element in the U.S. effort to open markets and fight protectionism.

The Uruguay Round is the first multilateral trade negotiation to include services, intellectual property rights and investment as part of a single trade negotiation. A Trade Negotiations Committee was established to manage the overall negotiations and two groups were created to oversee these negotiations: a Group on Negotiations on Goods to oversee the 14 individual groups that negotiate traditional GATT issues, including trade related to investment and intellectual property, and a Group on Negotiations on Services to oversee services negotiations.

The United States has played a prominent role in the negotiations, participating fully in the activities of the 15 negotiating groups dealing with various issues. Progress was made in many important areas, but critical issues, especially reform in agriculture, remained. Though originally scheduled to be concluded in Brussels in December 1990, the Round was extended to provide more time to reach a successful conclusion.

On December 20, GATT Director General Arthur Dunkel issued a "draft final act" to complete the Uruguay Round; market access commitments for goods and services were not included. The "draft final act" was a combination of negotiated texts and compromise solutions developed by negotiating group chairmen or by Dunkel himself. The U.S. initial assessment of the Dunkel text found that, while not perfect, it provided a basis for concluding the Uruguay Round. The U.S. final assessment of the Uruguay Round agreements awaited the negotiation of com

mitments for market access liberalization in goods and services, including financial services.

The Uruguay Round, in its final critical stage, is the United States' top trade priority. The United States made it clear that, at a minimum, it wanted comprehensive reform of agricultural trade, expanded market access for goods and services, greater discipline over trade-distorting subsidies, meaningful discipline in the "new areas" (intellectual property, services and investment) and more complete integration of developing countries into the global trading system.

Like previous rounds, the Uruguay Round included a challenging set of negotiations on market access-tariffs and nontariff measures restricting trade. The United States offered to cut tariffs by more than 40 percent, exceeding the 33 percent target set for the Round. The United States continued to pursue its proposal to slash tariffs to zero in nine important, heavily traded sectors: electronics, pharmaceuticals, wood products, steel, paper, nonferrous metals, construction materials, fish and beer. Efforts to improve market access included negotiations to reduce barriers to trade in tropical products, natural resource-based products and the integration of textiles into a strengthened system of GATT rules.

The United States also expected the final Uruguay Round package to include agreements in new areas of trade-services trade, trade-related investment measures and protection of trade-related intellectual property. The U.S. objective in services was to allow providers of services throughout the world to set up shop in foreign markets and compete like local firms. In the area of investment, the United States proposed prohibiting some investment measures and establishing rules governing the use of others. U.S. goals on intellectual property included higher standards of protection, effective enforcement of those standards and an effective dispute settlement mechanism.

A top priority for the United States was agreement on new market-oriented rules to reduce, and ultimately eliminate, the host of government measures which distorted world trade in agriculture. The United States took the position that fundamental agricultural reform could only be achieved through negotiation of specific commitments to reduce barriers to market access, export subsidies and trade distorting internal supports, and an agreement on sanitary and phytosanitary measures.

Finally, the United Sates hoped to gain agreement on improved GATT rules for tighter discipline on subsidies and

trade restrictions for balance-of-payments reasons, stronger dispute settlement procedures and greater commitment by developing countries to GATT rules. The United States strongly pressed its goal of achieving one set of trading rules for all GATT members, including the developing world.