Table 3. Obrvations on Poential FA Arangement Between Specific Trding Pamrn (Unaffcted trade flows over $50 billion)

|TIsde|Share o<br>xpot goa<br>thm<br>d<br>ae<br>o<br>1970|f totl<br>ing to<br> <br>(S)<br>1988|1988 Vaue of<br>Si1|Share of aFl FrA<br>ffd|
|---|---|---|---|---|
||||co(mn.)|unaece trade|
|North America and Debve d EAope<br>North Ameica's exots to Euroe|-<br>2943|-<br>2133|202,105<br>|14.5<br>|
|p p<br>Eupe's expots to Noth Ameica|()<br>9()|()<br>7(31)|90,174<br>111931|_6.5_<br>|
||||,|8.0|
|North Ameica and_Jemu_<br>North Awrica's exor to Jaan|-<br>914|-<br>1016|139.846<br>|10.0<br>|
|p p<br>Japan's export to Nordh Amenca|()<br>34|()<br>37|43,162<br>96684|3.1<br>|
||||,|6.9|
|Nordh America and Develoing South_and_SE Asia<br>North Amrica's exots t Sth Ai|-<br>|-<br>|134,<br>|9.7<br>|
|p o ou sa<br>Developing South Asia's etpo<br>to Japan|7(10)<br>25(31)|11(17)<br>29(37)|47,446<br>875S3|3.4<br>|
|<br>|||,|6.3|
|Japan and Develoing Soulh and SE Asia<br>Jaan's exots t Sth Al|-<br>|-<br>|112.134<br>|8.0<br>|
|p o ou<br>Developing South Aa's exos to Jaan|25<br>17(21)|25<br>1519|67,109<br>45025|4.8<br>|
|p p||()|,|3.2|
|Devehloed Eumre and Developing Soh and SE Asia<br>Develoed Euroe's<br>**t**Sh Ai|-<br>|-<br>|97.856<br>|7.0<br>|
|p p<br>xpors oou sa<br>Developing South Asia's exorts to Euoe|3(7)<br>1924|4(13)<br>17|46,316<br>|3.3<br>|
|p p<br>|()||51,540|3.7|
|Jaman and Develoged Euro e<br>Jaas exos to Euroe|-<br>|-<br>|80.206<br>|5.8<br>|
|p p p<br>Developed Europe's export to Japn|15<br>1(4)|21<br>2(7)|55,736<br>24470|4.0<br>|
||||,|1.8|
|Devetoed Europe and Devewoine Africa<br>Develoed Euroe's exorts t Afi|-<br>|-<br>|68.93S<br>|5.0<br>|
|p p p o rca<br>Deveoin Afica's exots to E|5(14)<br>6872|3(10)<br>|37,614<br>|2.7<br>|
|pg p urpe<br>|()|59(63)|31,321|2.3|
|Estern Euroe and Developing Counies<br>EAstem Europe's exports to Develoin Countries|-<br>1334|-<br>1737|56.727<br>4|4.1<br>|
|pg<br>Deeloin i<br>E|()<br>|()<br>|37,79<br>|2.7<br>|
|vpg coun<br>expors to aten Europe<br>|6(7)|3(5)|19,248|1.4|
|Developed Europe and Developing West Asia<br>Dld E'|-<br>|-<br>|56,460<br>|4.1<br>|
|evepe upes exports to Asia<br>Dli Wt Ad'|2(7)<br>|3(10)<br>|36,631<br>|2.6<br>|
|eeopng es as export to Europe<br>|44(47)|23(27)|19,829|1.5|
|Develoced Europe and Develoina Americas<br>Develoed Euroe's exors to Amri|-<br>412|-<br>|52.729<br>|3.8<br>|
|p p p cas<br>Developing Amerca's exports to Europe|()<br>32(39)|2(7)<br>23(27)|28,337<br>24,392|2.0<br>1.8|

p An unlikel aragemt. _be_ current MTNs salled due to diputes btween dkes paties and there s no indicaion they would be easier to addrmes biaeray. Eurp _now_ weem preoccupied wth the single MArket Initiaive and related problem.

Wide U.S. deficits andempts to band Japn an - unfair' ading patner make this combinaton unEkely as do the large number of discnimin y NTBs applied to Japan. A mor libly outcome is managed trade.

Persistent U.S. deficits with South and SE Asia, as we1 as the ltr's concentrati of exports in 'swnitive' sectors make this aagement diiEcult. U.S. discrimtory proteci also targets SE Asian NICs.

Developing Aia's reliance on the U.S. export market makes thi combinatin unlikely, not to ntion Worid War n memories. Alo, Yeats (1991) sow that Developing South ad SE Asia countws have very simir Comparative advant profiks - a point that would make an FIA diffwcult.

South Asia's reliance on the North American market all but precluds tisa ment. SE Asian NICs are oflen _taere_ by discrminaty Eumpean tade bariers.

Distance is a negative factor as is _Japan's_ export concentration in sensiive sectors. he fict that Japan's North Amercan exports are nealy twice great as those to Europe makes this arra em . Vat differences in industrialization vels make thae combinations very nlikely. There are few setors where Aiaindury could compete with Eumope.

Major Etern European internal probleo, plu a ack of expeiience in market-oriened relation with developing counries, makes agremet her vey unlikel.

Industrialization level and cultural differences make major FA ageements here unlikely.

Developing Amerca's reliance on the U.S. market all but precde these arrangements. Alo, industrialization level differenes ae a major negative factor.

Fgues in parenthes exclude the exporting region's intrratradc.