BRAVE-NEW-WORLD - INTERNATIONAL REGULATION OF SUBSIDIES AND THE FUTURE OF STATE AND LOCAL ECONOMIC-DEVELOPMENT PROGRAMS

Recent international trade agreements are likely to have profound effe cts on state and local development programs in coming years. The most important changes will come as a result of the new Agreement on Subsid ies and Countervailing Measures concluded as part of the General Agree ment on Tariffs and Trade. Provisions of the North American Free Trade Agreement and the United States-Canada Free Trade Agreement may also affect development efforts. This article examines the new rules on sub sidies and their implications for state and local economic development programs It concludes that these programs are likely to come under in creasing attack from trading partners of the United States. While ther e are limited exceptions to the new disciplines, many programs may hav e to be changed to comply with the new rules. Some programs may face c ountermeasures in other countries or may even be required to be remove d by international dispute settlement procedures.