1994-95: REVIEW AND OUTLOOK : ‘94/’95 TRENDS : Need the Keys to ‘95? Try These : Forging Ahead on the World Front

As 1994 was ending, we asked the distinguished members of the Times Board of Advisers to peer ahead into the new year and assess the prospects for the world, national, state and urban economies--and to offer their advice to business people and public leaders for 1995.

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1994 has been a banner year for international business. Four areas to watch in 1995 are:

* The implementation of the North American Free Trade Agreement, which has resulted in a significant increase in trade and investment across the Mexican-U.S. border. The current political turmoil notwithstanding, 1995 will see a consolidation of this important relationship through deals similar to that recently announced between AT&T; and the Alfa group, which will develop telecommunications services in competition with Telefonos de Mexico. The successful Miami summit of 34 hemispheric heads of state will lead to renewed efforts to extend this experience to the rest of the Americas.

* The troubled bilateral relationship with Japan, on which considerable progress was made last year. A historic agreement on patent and trademark protection, a pact on greater access to the Japanese market for a series of important U.S. industries (autos was the glaring exception), a high yen and economic recovery will pave the way for a reduction in the current trade imbalance.

* The Asian Pacific Economic Cooperation forum summit in Indonesia concluded on an optimistic note for free trade among most Pacific nations by 2020. But the question of political transition in China could set the agenda back and bring instability to the region.

* The passage of the General Agreement on Tariffs and Trade treaties will lead to the creation of the new World Trade Organization and a more aggressive judicial process for conflict resolution. Keep an eye on the U.S. Congress as it deals with challenges to its sense of sovereignty from trade-induced conflicts on environmental or other internal policies.