Taiwan appears ready to end its DRAM dumping battle with the US and observers are linking the move to the nation's efforts to join the WTO.
Taiwanese manufacturers of DRAM memory chips breathed a sigh of relief Saturday after the US International Trade Commission (ITC) said they would not face continued anti-dumping tariffs. The tariffs, which came into force in October, range between 8.21 percent and 69 percent.
"Justice has been served" said Genda Hu, head of the Taiwan Semiconductor Industry Association (TSIA), which represents Taiwan's DRAM makers.
The ITC determined that American companies had not been harmed or threatened by Taiwan-made chips sold below fair market value. Micron Technology, the US company whose complaint triggered the investigation, may appeal.
Micron could not be reached for comment yesterday.
On Sunday, a Ministry of Finance spokesperson told Reuters that, following the "friendly" US action, Taiwan would consider abandoning its own proposed 61.85 percent anti-dumping tariff against Micron, America's largest DRAM maker.
Hu said he believed this was the ministry's position, but felt the two cases should not be linked in this way.
Both ministry officials and TSIA say the decision on whether to continue pursuing anti-dumping claims against US DRAM makers should be left up to the injured party -- Taiwan's DRAM makers, such as Nanya Technology.
Charles Kao, executive vice president of Nanya, said his company would ask TSIA to drop the case against Micron.
In fact, Taiwan, which hopes to join the WTO soon, may have been looking for an excuse to quietly shelve the action, which named Micron and two smaller firms.
Many analysts say that Taiwan's action, although technically valid, was a response to the US charges, which had preceded Taiwan's claims.
One industry watcher described Taiwan's anti-dumping claims as "a counter-attack against Micron."
Calvin Chang, an analyst at Jardine Fleming Taipei, said the small amount of DRAM Micron sells in Taiwan presents no real threat to local manufacturers.
Others found the move hurting Taiwan in the long-run.
"Taiwan has much more to lose than to gain by any kind of protectionism," said Daniel Heyler, an analyst at Merrill Lynch in Taipei. "The industry here depends far more on the US than Micron depends on Taiwan."
Some local memory chip makers send 30 percent of their output to the US, either directly or indirectly, he said, and were being hurt by US tariffs. High-tech manufacturing, which generates one third of Taiwan's export earnings, will also benefit from an open DRAM market, he added.
Taiwan accounts for between 10 and 13 percent of global memory chip output, and shipped about US$450 million in memory chips to the US in 1998.
DRAM dumping has recently become far less of an issue because prices of the most common memory types have more than doubled since June, when they were selling below cost, Chang said.
Most analysts expect DRAM to remain profitable throughout 2000.
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