FILED PURSUANT TO RULE 497(e)
                                  March 3, 1997



Dear GMO Client:

         A  printing  error was  discovered  in the GMO Trust  Prospectus  dated
December 1, 1996.  Accordingly,  the two  paragraphs  under the heading  Certain
Risks of Foreign  Investments  --  Emerging  Markets on page 52 are  amended and
restated as follows:

         Emerging  Markets.  The risks  described above apply to an even greater
extent to investments in emerging  markets.  The securities  markets of emerging
countries are generally smaller, less developed,  less liquid, and more volatile
than  the  securities  markets  of  the  U.S.  and  developed  foreign  markets.
Disclosure and regulatory  standards in many respects are less stringent than in
the U.S.  and  developed  foreign  markets.  There also may be a lower  level of
monitoring and regulation of securities markets in emerging market countries and
the  activities  of  investors  in such  markets,  and  enforcement  of existing
regulations has been extremely limited. Many emerging countries have experienced
substantial,  and in some periods  extremely  high,  rates of inflation for many
years.  Inflation  and rapid  fluctuations  in inflation  rates have had and may
continue to have very negative  effects on the economies and securities  markets
of certain  emerging  countries.  Economies in emerging  markets  generally  are
heavily dependent upon international trade and,  accordingly,  have been and may
continue to be affected adversely by trade barriers,  exchange controls, managed
adjustments  in  relative  currency  values,  and other  protectionist  measures
imposed or negotiated by the countries  with which they trade.  These  economies
also have been and may continue to be adversely affected by economic  conditions
in the countries in which they trade.  The economies of countries  with emerging
markets may also be predominantly based on only a few industries or dependent on
revenues from particular commodities. In addition,  custodial services and other
costs  relating  to  investment  in foreign  markets  may be more  expensive  in
emerging markets than in many developed  foreign  markets,  which could reduce a
Fund's  income  from such  securities.  Finally,  because  publicly  traded debt
instruments of emerging markets  represent a relatively recent innovation in the
world debt markets, there is little historical data or related market experience
concerning the  attributes of such  instruments  under all economic,  market and
political conditions.




                                       -2-
                                                                   March 3, 1997

         In many cases,  governments of emerging  countries continue to exercise
significant control over their economies, and government actions relative to the
economy, as well as economic developments generally,  may affect the capacity of
issuers of emerging  country  debt  instruments  to make  payments on their debt
obligations,  regardless of their financial condition.  In addition,  there is a
heightened possibility of expropriation or confiscatory taxation,  imposition of
withholding taxes on interest payments, or other similar developments that could
affect  investments in those  countries.  There can be no assurance that adverse
political  changes  will not  cause a Fund to suffer a loss of any or all of its
investments or, in the case of fixed-income securities, interest thereon.

         We apologize for any inconvenience this may have caused.



                                          Grantham, Mayo, Van Otterloo & Co. LLC