53 



Beyond the GATT transition, I would like to make some addi- 

 tional observations about the longer term. First, the global market 

 is undergoing a dynamic change. The market economy comprised 

 about 1 billion people prior to the emerging markets in the former 

 Soviet Union and China. The challenge now becomes one of inte- 

 grating the 4 billion people currently outside the existing commer- 

 cial marketplace into a new global marketplace. 



This integration will be difficult and unpredictable. Presumptions 

 of a steady progress on free trade are simply not realistic. The pri- 

 vatization process occurring in all of the formally centrally planned 

 economies is dramatically altering the structure of the marketing 

 channels. 



The days of mega sales to single buyers are clearly gone. Market- 

 ing channels will replace Government-to-Government negotiations 

 and Government will need to retool its staff and programs in rec- 

 ognition of the change, and perhaps change their role. 



We have been amending 1930's programs for over 60 years in the 

 farm program area. Perhaps it is time we stopped trying to modify 

 and rethink some of our approaches. Government will never be ab- 

 sent from the food and agricultural marketplace because of a stra- 

 tegic role in domestic, economic, and political stability. Each Gov- 

 ernment will define a role for itself in each market and U.S. poli- 

 cies must respond to that type of competition. 



Infrastructure investment in emerging markets will have to be 

 viewed as a precursor to realizing the benefits of expanded mar- 

 kets. This includes information technology as well as infrastruc- 

 ture. 



The markets cannot expand without this basic investment and it 

 represents an opportunity for the establishment of a U.S. presence. 

 The evolution of each marketplace will be distinctly different due 

 to cultural, political, and economic realities unique to each market- 

 place. 



Generic market development programs will be as obsolete as 

 Government-to-Government trading programs. Trade strategies 

 will have to evolve for each market. U.S. agriculture and agri- 

 business will need to establish a presence in markets where its 

 competitors have a much longer history and in many cases well-es- 

 tablished commodity identities. Establishing the linkage between 

 the desired product characteristics and the U.S. label is crucial to 

 market success. 



Finally, about two-thirds of the population, about 2.5 billion peo- 

 ple, that will be integrated into this global marketplace, reside in 

 regions of the world that account- for only about 15 percent of the 

 world's economic activity. And as the world's population doubles by 

 the middle of the 21st century, 90 percent of the population growth 

 will occur in these regions. 



As we seek to make agriculture more responsive to market sig- 

 nals, we should not forget that these people do not have the dollars 

 to send signals. In both the domestic and foreign markets, there 

 must be mechanisms that allow those who cannot send market sig- 

 nals to be recognized. 



The conclusion from all of these observations is that the future 

 marketplace structure is very uncertain. Focus must be on flexibil- 

 ity, not rigid programs. It is absolutely essential to maintain the 



