U.s.-Japan Semiconductor Trade Agreement Of 1986

“Our semiconductor industry is much stronger than it was five or ten years ago,” said a senior U.S. trade negotiator. “If you have a 30% foreign market share, you obviously don`t need a similar deal.” In response to the U.S. government`s demands for a greater share of the Japanese semiconductor market, the Japanese government has asked many Japanese companies to purchase U.S. tokens. With regard to these chips unsuitable for their needs, some Japanese companies obey government chips and bought us, but then they left unused in storage. The Electronic Industries Association of Japan (EIAJ) said: “The level of semiconductor sales in the United States to Japan is not due to Japanese trade barriers or the opposition of Japanese customers to imports. It reflects market factors and is strongly influenced by U.S. marketing, product development and investment decisions. (William N. Walker and Stanton D.

Anderson, “Memorandum in opposition to SIAs Submission Under Super 301,” by the law firms Mudge Rose Guthrie Alexander and Ferdon; anderson, Hibey, Nautheim- Blair, Washington, D.C 1990, p. 5.) The group points out that the U.S. semiconductor industry competes with only about half of Japan`s semiconductor market. The Japanese market was very competitive, with most companies competing directly with each other for finished products. On the other hand, few U.S. semiconductor manufacturers also produce finished products. This indicates that the Japanese government has not played a key role in supporting the development of the industry. Michael Porter, of Harvard Business School, notes in a competitiveness study that “one of the strongest empirical results of our research is the link between national rivalry and the creation and perseverance of competitive advantages in an industry.

(Michael Becker, “Semiconductor Protectionism: Goodbye Mr Chips,” Citizens for a Sound Economy, Issue Alert No. 9, August 27, 1986, p. 1.) 4) Encourage the sale of U.S.-made storage chips in Japan with the goal of gaining at least 10 percent of the Japanese market for Americans. If necessary, the agreement implies that the Japanese government will force its industry to limit production, resulting in a shortage that could be filled by the United States.

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