N. America must get its act together

The 1990s have begun as an era of great transition. The world is awash with change. But most of these changes diminish or even ignore the role of North America.

The attention of the world is focused on Europe. The two Germanies are rushing toward reunification, possibly this year. The high-stakes drama of political and economic reform is being played out in Eastern Europe and the Soviet Union. Western Europeans are struggling to create a single market by 1992.

North America has become the lost continent in international discourse, increasingly treated - especially by Europeans - as a footnote among the forces shaping future global enterprise. This represents a new and important challenge for American business and political leaders. But it also presents great opportunities.

North America - the U.S., Canada, and Mexico - is a vast market, with 360 million people and a combined gross national product of nearly $5.5 trillion. The U.s. and Canada are well on the way to complementing a Free Trade Agreement that was initiated over a year ago. Mexico and the U.S. have recently announced their commitment to develop the framework for a free-trade arrangement by this time next year.

These three countries together constitute a formidable economic and trade bloc. They have the world's youngest, and most technically gifted, workforce. Measured by gross national product, they make up the world's richest trading group with the largest population and greatest reservoir of natural resources.

The U.S. is committed to global free trade organized under the General Agreement on Tariffs and Trade, know as GATT. Such an approach to international trade and commerce minimizes the role of government and expands choices for consumers and businesses.

But trading blocs are much more likely to increase the role of government in economic and business affairs. An international arrangement for trade and commerce based on trading blocs - such as the European Community's EC '92, a North American free-trade pact and an emerging Asia-Pacific grouping - would not be as favorable to America's entrepreneurial economy as is the present free-trade system, however imperfect, based on the GATT.

However, the GATT is in trouble. The current so-called Uruguay Round is not going well.

The U.S. and the European Community are deadlocked on agriculture. The U.S. wants to eliminate agricultural subsidies, and the EC wants to keep them.

Also, the Uruguay Round is not making much progress in extending the GATT to include protection for intellectual property such as patents and copyrights, or for trade in financial and other services, both vital to U.S. interests.

If the GATT talks, scheduled for completion in December, fail to reach agreements in at least two of these three crucial areas, trade blocs will begin to play an increasing important role in international commerce.

That's why it is important for North Americas to get their act together now.