WASHINGTON, D.C. – The United States and the People`s Republic of China have reached an agreement on terms governing China`s entry into the World Trade Organization (WTO). Under the reported terms of the accession package, China will participate in the Information Technology Agreement (ITA), eliminating tariffs on a number of high technology products, including semiconductor manufacturing equipment, by 2005. The agreement would also establish trading distribution rights and other rules on the transfer and trade of technology.
“China`s participation in the ITA is of critical importance to SEMI`s members,” said Stanley Myers, president of Semiconductor Equipment and Materials International (SEMI). “Tariffs on semiconductor equipment currently run as high as 40 percent, which presents a tremendous barrier to entry and trade. China`s membership in the WTO and the ITA will help establish a level playing field and allow all of SEMI`s members to fully participate in the expected growth of China`s semiconductor industry.”
According to U.S. Census Bureau statistics, China was the United States` 12th largest high-tech export market in 1998. High-tech exports to China that year exceeded $3 billion, representing about 21 percent of all exports to China. China is currently estimated to be an $8 billion market for semiconductors and has the potential to become the world`s second-largest market for semiconductors by 2010. China`s semiconductor industry is expected to grow 20 to 40 percent annually over the next 15 years, faster than any other region during the next decade.