The Organization for Economic Cooperation and Development (OECD) countries are responsible for just under three-quarters of all world trade. Similarly, three-quarters of the total trade of these countries consists in the mutual exchange of goods, of which one-fifth relate to manufactured products (GATT 1994:80-1, 92-5). Only in trade with developing countries do the import and export structures of the OECD differ in any marked way in terms of major product groups. The greater part of OECD trade in services also takes place between its own members (Petersen et al. 1993:98-100). Given these relations, it would seem obvious that, as far as the OECD countries are concerned, the results of the Uruguay Round are of relevance chiefly in terms of their reciprocal trade. However, there are two reasons why this is not the case.
For one thing, 60 per cent of internal OECD trade is within the European Economic Area, consisting of the European Union (EU) and the remaining European Free Trade Association (EFTA) countries. But Western Europe has regulated both its internal trade (except for trade in agricultural goods between the EU and EFTA) and the rules governing freedom of establishment, according to its own set of laws, which are more far-reaching compared with those of GATT. Tariff-free trade between the North American Free Trade Area (NAFTA) countries (USA, Canada, Mexico) and between Australia and New Zealand has, similarly, to be excluded. Overall, a residue of only a little less than one-third of total internal OECD trade remains which is subject to the most favoured nation (MFN) duties agreed in the GATT—in other words to which the Uruguay Round is relevant.
Second, the internal trading relations of the OECD countries, or country groupings, do not contain as much potential for conflict as do their external ones. Much of what has now been agreed in Geneva for all GATT countries,