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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: JohnG who wrote (658)	7/11/2000 11:32:56 AM
From: JohnG	Respond to of 197563

NTT exhorbitant connect charges are subject of increasinng US/Japam trade friction. JohnG totaltele.com Japan stays silent over U.S. rates rejection By Reed Stevenson, Reuters 11 July 2000 Japan maintained a defiant stance on Tuesday after Washington's top trade official dismissed its compromise offer of faster cuts in local phone charges as completely inadequate. U.S. Trade Representative Charlene Barshefsky's categorical rejection of Japan's offer to lower rates one year earlier than its official proposal came on the second day of delicate negotiations between the world's two largest trading partners. "I would like to refrain from discussing details of the talks," Posts and Telecommunications Minister Kozo Hirabayashi told reporters, when asked to respond to Barshefsky's comments. The United States is demanding Nippon Telegraph and Telephone Corp (NTT), Japan's dominant telecoms carrier, immediately reduce by 41 percent the rates it charges rivals for access to its network of domestic telephone lines. Japan, arguing that such a move would cut into the former state monopoly's profits and spark job losses, has floated a 22.5 percent reduction in rates over three years, a one-year compromise on its official proposal. Both sides are likely to end up compromising further and Barshefsky said in Washington on Monday that "...the proposals that the Japanese government have brought to us on reductions in NTT's interconnection fees have been entirely inadequate." Although Washington had dismissed Japan's three-year compromise before, her unambiguous opposition underlines there is still a wide gap between the two negotiating teams. "I think that they will settle for somewhere in between, at around 30 percent," said Hironobu Sawake, senior analyst at ING Baring Securities, adding it would be difficult to predict a time period the two sides would settle for. PRE-SUMMIT AGENDA Both sides are keen to resolve the row before U.S. President Bill Clinton and Prime Minister Yoshiro Mori meet next week before the Group of Eight (G8) summit from July 21-23 in Okinawa. U.S. trade sources said Tokyo would prefer to strike an agreement before Barshefsky joins the talks around July 18. A Japanese source said both sides would present their positions on the issue in negotiations on Tuesday afternoon and that Tokyo would formally present its official proposal to cut rates by 22.5 percent over four years. Assistant Trade Representative Wendy Cutler is heading the U.S. side of the talks and will be joined by Deputy U.S. Trade Representative Richard Fisher later this week. Washington argues that interconnection rates charged by NTT - which has an iron grip on 90 percent of lines connecting homes and businesses - are too high, inhibiting growth in the quickly evolving communications industry. A more vibrant telecommunications environment with new players, they say, would also help Japan's recession-weary economy move towards higher growth and allow an Internet-led information technology revolution to take hold. Barshefsky has threatened to take the issue to the World Trade Organisation and file a complaint against Japan by the end of July if it refuses to cut the fees. NTT is under pressure to act from inside Japan as well. Government ministers have stressed the need for for faster telecoms deregulation and on Tuesday Japanese and U.S. business leaders formally issued a joint resolution calling for a "substantial and prompt" cut in NTT rates.