Conflict and Cooperation in National Competition for High-Technology Industry (1996) / Chapter Skim
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Pages 121-130
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From page 121... ...
Insofar as the political tensions created by these national programs are unlikely to diminish, it is important that they receive sustained attention from policymakers. Improved understanding of the rationale for government support for hightechnology industry and the recognition that governments will continue to actively support high-technology industry within their borders are essential for effective policymaking.
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From page 122... ...
NEW TECHNOLOGIES AS A SOURCE OF COOPERATIVE ALLIANCES The race to exploit the opportunities inherent in new technologies generates powerful incentives for greater cooperation between otherwise competing companies and national programs. New product development increasingly involves companies in a broad array of complex technologies and production processes with high capital costs and special expertise, encouraging alliances across sectors and national boundaries.
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From page 123... ...
Successful international cooperation requires that the limitations of national objectives and other factors be taken into account. These limiting factors include • asymmetries in the structure and funding of national programs, • the different technological competencies and assets nations or firms bring to a cooperative enterprise, • the related perception that some countries are not contributing their "fair share" to basic research, and • inadequate and ineffective intellectual property protection and investment regimes which discriminate against foreign acquisition and fail to provide national treatment (formally or informally)
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From page 124... ...
For example, it could gather improved data concerning formal rules for participation in national or regional technology programs, supplemented by objective assessments of current administrative practices, i.e., actual foreign participation and its rationale, rather than theoretical "openness." CONDITIONS FOR SUSTAINABLE INTERNATIONAL COOPERATION The growth and success of international cooperation will thus be determined by the terms and conditions of proposed cooperation as well as by the history of previous cooperation. The degree of agreement on shared priorities, equitable technical contributions (not merely financial contributions)
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From page 125... ...
DOMESTIC POLICIES WITH INTERNATIONAL CONSEQUENCES Efforts to further technological cooperation, particularly public/private cooperation, therefore imply parallel efforts to further trade liberalization in areas "within the borders," such as government procurement, national treatment for foreign investment, and effective competition policy. Sustainable cooperation implies a competitive, transparent procurement regime, the right of establishment for foreign investors, including roughly comparable regimes for the acquisition of existing firms as well as market access for final products resulting from such cooperation.
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From page 126... ...
PROGRESS ON GOVERNMENT PROCUREMENT Public procurement remains a major means of government support for national industries and a significant source of friction in the international system. Because a significant share of markets for high-technology products is derived from public purchases, discriminatory public procurement of
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From page 127... ...
Recent calls for negotiations on a full and complete mutual recognition agreement for medical devices, telecommunications terminal equipment, information technology products, and electrical equipment, as well as a common registrations dossier for new drug products, should be supported.
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From page 128... ...
The high cost, rapid innovation, and short product cycles characterizing these industries make it possible for significant damage to domestic industry to occur in relatively short periods. Moreover, the higher returns which accrue to national firms benefiting from these practices can provide the resources to fund additional research, more rapid product development, expanded marketing, and overseas acquisitions of competitors.
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From page 129... ...
Unequal access undermines the basis for sustainable international cooperation in the development of new technologies. These asymmetries in national investment policy are a major source of trade imbalances and also generate pressures for restrictions on investment in countries which do have relatively open investment regimes.
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From page 130... ...
competitive position. In the case of Japan and the industrializing East Asian economies, more open investment regimes would offer substantial benefits while also contributing to more balanced, and therefore more sustainable, trade flows.
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