Third-World governments have frequently professed the virtues of trade diversification, and they have voiced a number of legitimate concerns about what can happen if this is not achieved. First, the greater the geographical concentration of their export trade, the more vulnerable are they to fluctuations arising from changes in the level of imports, devaluations, or other developments in their principal markets.1 When, for instance, exports were directed predominantly towards the relatively slow-growing European Economic Community in the late 1970s and early 1980s, the exporting countries might have been better off if their outlets had been more diversified. Second, various pressures may be exerted to induce smaller countries to purchase most of their needed imports from the larger trading partner that has bought most of their exports.2 Those with geographically concentrated exports are particularly vulnerable in tariff disputes, or what J. A. Conybeare has termed ‘trade wars’.3 Finally, countries which are particularly dependent on individual export markets are vulnerable to ‘linkage’ pressures – attempts by their powerful partners to utilise economic leverage to force concessions on non-trade issues, often political in nature.4