ABSTRACT
On the trade policy front, there were two noteworthy events: Congress adjourned at the end of 1986 without passing major protectionist legislation, and the Uruguay Round of multilateral trade negotiations was inaugurated in September. Negotiations will not be officially held under GATT auspices, but "GATT procedures and practices shall apply" and "GATT secretariat support will be provided." Results will be reported to the GATT Trade Negotiations Committee, where implicit trade-offs will be made between the goods and services sectors. In the international economic arena, this agenda would require major efforts to breathe life into the Uruguay Round negotiations; it will also call for the political courage to resist import protection and a willingness at very high levels to coordinate macroeconomic policies in a way that promotes vigorous world growth. The Reagan administration responded to the new mood by adopting a more aggressive stance against unfair trade practices abroad, subsidizing agricultural exports, and moving to correct the overvalued dollar.
