TALKS FAIL TO HEAD OFF CHIP SHOWDOWN WITH JAPAN
Talks between the United States
and Japan on alleged Japanese dumping of computer microchips
have failed to head off U.S. imposition of retaliatory tariffs,
two senior White House officials said.
    President Reagan's chief of staff, Howard Baker told
reporters here that he saw no developments that that would
cause the president to back away from his plan to issue a
proclamation on Friday slapping 100 per cent tariffs on a range
of Japanese electronic products.
    "I assume that there will be a proclamation on Friday,"
Baker said.
    Reagan's National Security Adviser, Frank Carlucci added,
"It looks like a very difficult situation at this point."
    Carlucci said that evidence of Japanese "dumping" of
microchips had been "fairly conclusive." The alleged dumping --
selling abroad at below the cost of manufacture -- is said to
have undercut the technologically important U.S. microchip
industry.
    Carlucci also said that although Japanese officials had
presented statistics designed to show that Japan was opening
its markets to American producers of microchips, "our
statistics do not confirm this."
    "Indeed, they tend to go in the other direction,"Carlucci
said.
    President Reagan announced on March 27 that he planned to
raise tariffs on as much as 300 mln dlrs in Japanese exports to
the United States.
    He accused Japan of failing to enforce major provisions of
a September 1986 agreement on preventing microchip dumping and
providing American industry with fair trade opportunities.
    He said he would be prepared to lift the sanctions when
Japan took corrective action on these two issues.
    The dispute has soured U.S.-Jpanese relations as Japanese
Prime Minister Yasuhiro Nakasone prepares to visit Washington
at the end of the month for talks with Reagan.
    Last Friday Reagan, answering questions following a speech
to the Los Angeles World Affairs Council, said Nakasone had
endangered his political standing at home because of his
willingess to try to eliminate trade barriers against U.S.
goods.
    He said he was looking forward to his talks with Nakasone
and "he has been most helpful."
    Today Reagan was vacationing at his ranch near here.
 Reuter
