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Trade barriers a slippery slope, analyst warns

Posted: 02 Apr 2004 ?? ?Print Version ?Bookmark and Share

Keywords:semiconductor? isuppli? wapi wireless?

A leading industry forecaster warned that erecting trade barriers in North America as a response to high-tech offshoring would cripple the global semiconductor industry.

Dale Ford, VP of iSuppli Corp., noted that while Asia-Pacific is accounting for an increasing amount of semiconductor content. Most of the companies selling into that region are still located in North America.

As for chip consumption in North America, companies headquartered there still sell 70 percent of the semiconductors consumed in that market.

"If we want to put up trade barriers, we should be prepared for a devastating impact in terms of retaliation from companies offshore," Ford said during a press conference at the electronicaUSA with Embedded Systems Conference event.

"We're in a highly interdependent environment in semiconductors," he said. "If we start inserting trade barriers, it will create a very difficult environment to continue sustained growth in the semiconductor market."

Ford pointed out that not only is there a rising tide of protectionism in the U.S., but Chinese is practicing subtle forms as well, including the WAPI wireless security standard, which is not compatible with western wireless protocols.

Ford also urged caution to CEOs lured by the siren song of offshoring.

"Setting up a global [design] team is a nontrivial exercise," he said. "From a business perspective, CEOs have to exercise great care in how they allocate resources across regions."

- Brian Fuller

EE Times

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