Series Title | European Voice |
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Series Details | 18/09/97, Volume 3, Number 33 |
Publication Date | 18/09/1997 |
Content Type | News |
Date: 18/09/1997 By PEACE is breaking out in the world electronics components industry. Japan, the US, South Korea and Europe have long been bitter adversaries in trade battles to keep foreigners out of strategic markets at home but at the same time win market share in enemy territory. Now, long-running EU anti-dumping complaints are fizzling out, this year's tariff-busting World Trade Organisation Information Technology Agreement (ITA) is kicking-in, more tariff cuts are promised, and trade bodies from the four protagonists are talking to each other. Much credit for this turn around must go to the European Electronic Component Manufacturers Association (EECA) which, along with the European Commission, has fought tirelessly for cuts in international tariffs on IT components. EECA secretary-general Eckhard Runge says the Brussels-based lobby joined forces with the Commission to fight US industry over the inclusion of so-called 'passive components' such as capacitors and resistors in the ITA deal. “They are major components in all kinds of electronic products. It was difficult for the Commission to get them included in the ITA catalogue. The US came up against pressure from its own industry to leave these components out. Now they are included in the deal, US industry has sued its own trade department,” he says. After a good start, European industry is also pushing to see more of its trading partners in the IT sector sign up to the agreement. “We are continuing with negotiations on the ITA. The ongoing issue is having more countries in the agreement, in particular Mexico and the Latin American countries,” he says. The EECA came out of the ITA negotiations with its role enhanced. The Commission made its acceptance of the agreement conditional upon Europe being allowed to join the newly formed World Semiconductor Council. This body replaces the previous semiconductor club whose only members were the US and Japan. But while the EECA has pushed for tariff cuts and changes to WTO rules, it has this month also been locked in negotiations with Japanese and Korean industry to clinch a deal that will see it drop its complaint against dumping of dynamic random access memory chips (D-RAMs) from Japan and South Korea. The association wants to strike an accord with Japanese and South Korean industry groups to voluntarily track the prices and costs related to production of these chips. As long as the data collected shows that manufacturers in these countries are not selling below cost, Runge says the EECA will then call on the Commission to drop its formal anti-dumping measures on the D-RAMs found in personal computers and other devices. “The EECA and the European Commission have an understanding that measures will be discontinued when data collection pacts are set up with Japan and South Korea,” he explains. “These talks are ongoing. The EECA has sent a delegation to Seoul to speak with the Korean semiconductor association. Talks have also been taking place this month in Tokyo with the Japanese industry association.” The industry pact would mean an end to the measures which have been an irritant to EU relations with the Far East for more than ten years. “Anti-dumping began to be an issue in 1986. It started with Japanese EPROMs. That was the first case that was introduced by us. Japanese D-RAMs followed and a little bit later we introduced D-RAM cases against South Korea,” says Runge. Union anti-dumping measures have already been dropped on both Japanese and South Korean flash erasable programmable memory chips - another key component in electronic devices such as mobile telephones. But while the EECA fights for the fair trade rights of its members, foreign manufacturers are quietly infiltrating Union markets by setting up fabrication plants here. Germany's Siemens is the only indigenous firm manufacturing semiconductors inside Europe, says Runge. “Then we have IBM, Texas Instruments, NEC and Fujitsu. Philips is manufacturing, but it shares a plant with IBM. Other companies are building up capacity. Mitsubishi and Hitachi have a factory in Germany while Samsung and Hyundai have plans for plants in the UK,” he explains. Amid this flurry of activity in the British Isles, Runge laments rumours that the UK's last big indigenous chip company GEC Plessey Semiconductors is about to pass into foreign hands. “It is very unfortunate that there will be no large UK semiconductor company left if GEC Plessey Semiconductors is sold. Rumours abound that a Korean company or even Siemens might be ready to buy it,” he says. Japanese and Korean firms may be on European soil but this has not led them to support past EECA calls for anti-dumping measures against their compatriots. “IBM, Texas Instruments and Motorola have said they are on our side in anti-dumping issues but, of course, the Japanese and Koreans are not,” comments Runge. |
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Subject Categories | Business and Industry, Trade |
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