TRADE WAR AVERTED

Retreating from the brink of apotentially devastating trade war,the U.S. and Japan reached a significant new agreement just twelve hours before a U.S.-imposedmidnight deadline."This agreement is specific. It is measurable," a jubilant President Clinton said in announcing the deal, which he called "a major breakthrough toward free-trade throughout the world." Japan will yield on the major sticking point of the negotiations by taking steps to open its markets to American auto manufacturers. Under the deal, Japanese companies say they will increase their purchases of American cars and auto parts by more than $9 billion over the next three years (1994 purchases totalled $19 billion). In addition,200 new American car dealerships will open in Japan next year, and 1,000 in all over the next five years.In return, the U.S. agrees not to impose its threatened 100 percent tariff on Japanese luxury cars.