The end of the Cold War and the current Persian Gulf crisis have dramatically raised the stakes for global free-trade talks that were designed to push the world of international commerce into the 21st century.

The final six days of the talks start tomorrow in Brussels, and the results could do as much as the events in the Middle East to determine the character of international cooperation and competition in a world without an East-West divide, according to top-level public officials and experts in international politics and commerce.

"It is a highly significant test of the willingness of countries to accept international responsibility," said a senior U.S. Treasury Department official. "In effect, this is the first test of post-Cold War economic cooperation," said C. Michael Aho of the Council on Foreign Relations.

"The implications ... have grown well beyond trade. They go to the ability of the big industrial nations to cooperate in the mid-1990s," said Robert D. Hormats, vice chairman of Goldman Sachs International Corp. and former assistant secretary of state for economic affairs. "If they fail in trade, it will be difficult for them to cooperate in the Persian Gulf and on other political and strategic issues.

"The whole basis of the new world ... is that the Americans, the Japanese and the united Europeans would work together to create a better economic order and a new world political order."

The issues on the negotiating table are wrapped up in the arcane language of a post-World War II institution called the General Agreement on Tariffs and Trade, known as GATT. The negotiators' goal is to promote the buying and selling of everything from corn to printing presses to insurance across international boundaries.

When the negotiations began four years ago, the Berlin Wall still stood and the idea of a rapidly uniting European Community was still a dream. Then, the goal was to take a system that had increased world trade fiftyfold -- in the process lifting the wealth of nations and individuals -- and expand it into new areas that take a growing share of global commerce, such as advanced technology, international finance and overseas investment.

These areas, uncovered by GATT, amount to one-third of all trade, about $1 trillion. Without those changes, the ability of a free-trade compact to enlarge the global economy in the next century the way it did in the past is being called increasingly into question. "GATT may become an organization where its rules are honored more in the breach," said Alan Oxley, former Australian ambassador to GATT.

For all the emphasis on the future, the negotiations, called the Uruguay Round because they were launched in that South American nation, are foundering over an issue that evokes the past -- protection of farmers. Bitter differences between the United States and its Western European allies have developed over government price support for farmers, which is a bedrock question for European politicians. With the farm trade talks deadlocked, negotiations have ground to a halt in other key sectors.

Facing the possibility of failure or continued stalemate, U.S. Trade Representative Carla A. Hills now talks about possible lost benefits, including $4 trillion she says the world economy would gain over 10 years from increased trade flowing from an agreement. A failure of the talks, she said in an interview, would intensify existing trade frictions, encourage simmering protectionism and create "instability" among emerging democracies in Eastern Europe and South America that need free trade to get their economies moving.

Political Concerns There is more at stake, however. A senior European official also acknowledged that the transatlantic trade differences are threatening to spill over into the political arena and could undermine continued cooperation in the Persian Gulf.

Hills underscored the point: "The very act of drawing into collaboration" in the gulf and on future foreign policy problems "is going to require us to have trade tranquillity. It will be difficult to generate the international cooperation that we need to deal with tomorrow's problems if we are at each other's throats on economic and trade issues."

The ties between political cooperation and international trade rules have been heightened by a new view of national security that values economic strength as much as bombs and missiles. Furthermore, the growth of a nonmilitary Japan as an economic superpower and the end of the Cold War have created multipolar power centers in the world, replacing the superpower rivalries that dominated global politics for the past 40 years.

Moving in concert with these developments, the political map of Europe has been redrawn by the decline of communism and the speedy movement of Western Europe into an economic and political union dominated by a unified Germany. The Soviet Union's former East European allies are reaching out to Western political and economic ideals, presenting new challenges to established systems such as GATT.

GATT, along with the World Bank and the International Monetary Fund (IMF), are the multilateral agencies created under U.S. leadership after World War II to manage and expand the world economy.

Instead of working in GATT with the United States to forge a new world order, however, former U.S. trade representative Michael B. Smith observed, "The Europeans are being obstinate, the Japanese are not doing anything."

Hills said the Japanese could exhibit the kind of leadership role equal to their economic power by agreeing to end their outright ban on imports of rice. "They could lead by example" in the GATT talks, she said.

Rivalry's Role Kendall Myers, a European specialist at Johns Hopkins University's School of Advanced International Studies, said neither Japan nor a Western Europe led by a united Germany is ready to assume the global leadership role that the United States held for the past 45 years.

"These three power centers {Japan, Western Europe and the United States} would like to be able to get together and tell the world what the new order will be," said Myers. "But there is so much rivalry between them that they cannot get together."

Facing the possibility of no agreement, or a lesser accord than envisioned, Bush administration officials led by Hills have backed away from the "Apocalypse Now" scenario for the future of world trade that they had been painting in past months.

But Hills still maintains that U.S. industry, farmers and Congress will not accept a package of GATT reforms that includes only minimal liberalization in agriculture, investment and trade in services as well as protection against the piracy of patented products.

If the 107 nations meeting in Brussels fail to come to a broad agreement, Hills said the United States "will try very hard to manage trade frictions and to negotiate trade liberalizations where we can."

"There will be another day when there may be more political will" among trading partners to make needed concessions, said Hills. "If I can't get it," she added ruefully, "my successor will."

Standing Firm Other administration officials believe that the United States should stand firm on President Bush's prescription that no deal at Brussels would be better than accepting a bad deal. A senior administration official said this would demonstrate to Congress that the administration is looking out for U.S. commercial interests and demonstrate to Western Europe and Japan that the United States expects them to make the kind of concessions that go with their new political and economic strength.

"For 40 years, we've been paying all the bills," the official noted.

But Enriques Iglesias, head of the Inter-American Development Bank and the foreign minister of Uruguay when the trade talks were launched, said the losses from a failed round of trade talks will be most profound for developing countries and Eastern European nations that have just broken from communism.

"To put a brake on expansion of trade is to put a brake on the expansion of the world economy," he added. "Today, we need growth and expansion in the world more than before."

Canadian Ambassador Derek H. Burney questioned whether the big three in the talks -- the United States, Germany and Japan -- really need the Uruguay Round and suggested that they would be hurt least by the trade frictions that are likely to accompany its failure. Recalling Canada's national animal, Burney said: "The elephants don't need the rules the same way the beavers do."


In 1948, 23 nations reached the General Agreement on Tariffs and Trade; since then, more than 100 countries have accepted it. Two-thirds of world trade falls under GATT rules. The agreement is administered by a secretariat that is headquartered on the banks of Lake Geneva.


GATT's guiding principles include trade without discrimination under most-favored-nation principles; using tariffs rather than import quotas to protect domestic industries; providing a stable, predictable basis for trade through negotiated tariffs at fixed minimum levels; and settling disputes through negotiations and, as a last resort, dispute settlement procedures. THE URUGUAY ROUND

The Uruguay Round of GATT talks, named for the South American country where the round began four years ago, is the eighth in a postwar series of talks that have lowered tariffs and increased world trade. THE MAJOR ISSUES Agriculture

Farm issues have been the linchpin of the talks. The United States and 14 other nations want cuts of 75 percent to 90 percent in government subsidies for exports and special payments to help farm production, and reduced barriers to foreign agricultural goods. But Western European nations are offering a 15 percent cut in production payments, and no reduction of export subsidies or trade barriers. The Bush administration has said it would not sign an agreement without sweeping agricultural trade changes.


In talks to bring banking, telecommunications and other services under GATT rules, the United States rejected a deal to let Europe keep its telecommunications markets closed to foreign companies while the deregulated U.S. market stays open. Europe wants audio-visual services exempted from GATT to preserve limits on foreign programs on its radio and TV networks. Australia and Canada want entertainment industry exemptions to preserve their cultures. No one appears to want air transport and ocean shipping covered, and the U.S. maritime industry kept shipments between American ports out of the free trade agreement.

Intellectual Property

Piracy of patented products has moved from blue jeans to high technology with the growing economic importance of computers, costing U.S. firms $60 billion a year in lost sales. Third World nations many of which make little effort to stop product counterfeiting, are resisting GATT rules against trade in pirated products, arguing that they will impede their technological development and increase the cost of needed medical supplies to their poor. U.S. firms back domestic laws against piracy and some favor raising the threat of trade retaliation to pressure other countries to enforce laws against piracy.


Developed nations oppose rules seen as discouraging foreign investment, especially requirements that foreign companies buy components locally, produce only for export and keep foreign exchange earnings in the country. Third World nations oppose such changes, saying the rules don't hurt trade and are vital for their national development.


Industrial nations' quotas on cloth and clothing imports, largely from developing countries, are to be phased out, although the extent and pace remain to be negotiated. This is the price industrialized nations are paying to the Third World for agreements on intellectual property and investment rules. The U.S. textile industry opposes the changes.


The United States backs tough rules against government subsidies to industries. Japan, South Korea, Hong Kong, Singapore and other Asian nations want to make it harder to impose penalty duties on subsidized goods, which they see as harassment based on their export success. The gulf is so wide that there may be no agreement on this issue.


The talks aim to cut tariffs by one-third. The United States opposes Europe's 15 percent tariff on semiconductors -- Japan, Canada and the United States have no such duties -- but the Europeans want to reduce it to only 9.2 percent.