U.S, -Japan Trade War: The Opening Battle

Publication Date: April 1987

Publisher: Heritage Foundation (Washington, D.C.)

Author(s): Edward L. Hudgins

Research Area: Trade

Keywords: Trade and foreign aid

Type: Report

Coverage: Japan

Abstract:

For the first time since World War II, the U.S. has retaliated against Japan for alleged unfair trade practices. Specifically, the Reagan Administration charges that Japan has not complied with a bilateral August 1986 agreement, which would prevent Japanese businesses from selling certam semiconductor computer chips in third countries for less than their cost of production, a practice known as "dumping." In addition to the dumping charge, the Reagan Administration maintains that the Ja anese government has failed to permit U.S. firms to win more than a 10 percent share of the Japanese chip market. To retaliate against these alleged ractices, the Administration has placed 100-percent tariffs on some $300 million worth of Japanese imports, effectively keeping many of these goods out of the U.S. market.