SIA: TPA will further open world markets

May 13, 2002 – San Jose, CA – The Semiconductor Industry Association (SIA) welcomed news that the Senate has reached a bipartisan compromise that will allow work to go forward on Trade Promotion Authority (TPA).

Passage of TPA will give the administration the ability to begin negotiations that will further open foreign markets to US high technology exports. Now that a bipartisan compromise has been reached, SIA looks forward to prompt passage of the bill by the full Senate and a positive outcome in the House as well.

“The semiconductor industry faced very challenging market conditions recently — the contractions we faced last year in established markets underscores the need for new markets. In the first quarter of this year, the Asia Pacific market grew 11% — nearly double our growth here in the United States,” said SIA President George Scalise. “American semiconductor companies derive more than 50% of their revenues from overseas sales, and are dependent on having access to fair and competitive markets. Where we can compete fairly, we can win.

“Many of our foreign competitors — including Europe and Japan — have concluded free trade agreements with a number of key markets while the US has waited on the sidelines. TPA will let the administration negotiate deals to put American companies on the same competitive footing,” Scalise added. “In March of this year, the part of the world outside of our borders comprised almost 75% of semiconductor sales — we must actively pursue full and fair access to those markets if we are to remain competitive.”

The deal reached in the Senate has strong bipartisan backing. Senators Baucus (D-MT) and Grassley (R-IA) played key roles in shepherding the legislation through the Senate Finance Committee, and Senator Daschle (D-SD) and the Bush administration worked together to bring the compromise to a conclusion.

Among the key trade negotiations that the US will be able to pursue utilizing TPA are the new round of World Trade Organization (WTO) talks, as well as work on reaching free trade agreements.

SIA has a number of key priorities within the context of the WTO talks, including such issues as eliminating tariffs on semiconductors and IT goods around the world, strengthening IP protection, and maintaining strong US trade laws. TPA will also enable US negotiators to pursue free trade agreements in areas like Latin America, where prohibitively high tariffs are maintained on many high technology goods.

TPA permits the administration to negotiate trade agreements subject to an up-or-down vote in Congress without possibility for amendments, but it requires the administration to engage in extensive discussions with the Congress during the negotiations.


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