Trade
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This seminar is part of SPRIE's Fall 2003 series on "High-Tech Regions and the Globalization of Value Chains."

Over the past two decades, the physical products that we consume have increasingly been manufactured offshore. More recently, some business and consumer services have started moving overseas. India is an important destination for such work, as it has low labor costs, good remote process management skills, and adequate infrastructure. The talk will report on a recent visit to India in which about fifty business process outsourcing firms were interviewed. The work is part of a research project funded by the Sloan Foundation on understanding the impact of the globalization of business processes on the U.S. economy.

Martin Kenney is a professor in the Department of Human and Community Development at the University of California, Davis and a senior project director at the Berkeley Roundtable on the International Economy at the University of California, Berkeley. His research includes the role and history of the venture capital industry and the development of Silicon Valley. Kenney's recent books include Understanding Silicon Valley: Anatomy of an Entrepreneurial Region (2000) and Locating Global Advantage (forthcoming). He has consulted for various governments, companies, the United Nations, and the World Bank. He has been a visiting professor at Cambridge University, Copenhagen Business School, Hitotsubashi University, Kobe University, Osaka City University, and the University of Tokyo. He holds a B.A. and M.A. from San Diego State University and a Ph.D. from Cornell University.

Philippines Conference Room

No longer in residence.

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Rafiq Dossani was a senior research scholar at Stanford University's Shorenstein Asia-Pacific Research Center (Shorenstein APARC) and erstwhile director of the Stanford Center for South Asia. His research interests include South Asian security, government, higher education, technology, and business.  

Dossani’s most recent book is Knowledge Perspectives of New Product Development, co-edited with D. Assimakopoulos and E. Carayannis, published in 2011 by Springer. His earlier books include Does South Asia Exist?, published in 2010 by Shorenstein APARC; India Arriving, published in 2007 by AMACOM Books/American Management Association (reprinted in India in 2008 by McGraw-Hill, and in China in 2009 by Oriental Publishing House); Prospects for Peace in South Asia, co-edited with Henry Rowen, published in 2005 by Stanford University Press; and Telecommunications Reform in India, published in 2002 by Greenwood Press. One book is under preparation: Higher Education in the BRIC Countries, co-authored with Martin Carnoy and others, to be published in 2012.

Dossani currently chairs FOCUS USA, a non-profit organization that supports emergency relief in the developing world. Between 2004 and 2010, he was a trustee of Hidden Villa, a non-profit educational organization in the Bay Area. He also serves on the board of the Industry Studies Association, and is chair of the Industry Studies Association Annual Conference for 2010–12.

Earlier, Dossani worked for the Robert Fleming Investment Banking group, first as CEO of its India operations and later as head of its San Francisco operations. He also previously served as the chairman and CEO of a stockbroking firm on the OTCEI stock exchange in India, as the deputy editor of Business India Weekly, and as a professor of finance at Pennsylvania State University.

Dossani holds a BA in economics from St. Stephen's College, New Delhi, India; an MBA from the Indian Institute of Management, Calcutta, India; and a PhD in finance from Northwestern University.

Senior Research Scholar
Executive Director, South Asia Initiative
Rafiq Dossani
Martin Kenney Professor University of California, Davis
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On the eve of accession to the World Trade Organization (WTO), with the aid of border policies, China was the second largest corn exporter in the world. During the time prior to accession, China's corn prices were estimated to be more than 30 percent above world market prices (Huang, Rozelle and Chang, 2003). China's government explicitly admitted to providing subsidies for corn exports of up to $US35 per metric, which accounted for almost all of the protection that corn producers in China were receiving. During the late 1990s and through 2001, with such high subsidies the nation's exporters were able to sell around 5 million metric tons (mmts) annually into world markets (Gale, 2003). Most of the shipments, especially in the 2000 and 2001, were sent to Korea and Malaysia. With such large shipments, the exports of other nations in the world (especially those from the US that traditionally was Korea's main supplier of feed grains) were displaced.

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US Grains Council
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Scott Rozelle
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The most important policy measures are those that improve the quality of rural Chinas human and physical resources and infrastructure that will provide the skills and abilities to rural residents that seek to integrate themselves into the nations industrializing and commercializing cities. Successful development policy, however, must also recognize that modernization is a long process that will depend on maintaining a healthy agriculture and rural economy.

While a rural development plan has many components, we restrict our attention to three broad issues: (a) the nature of Chinas new economic landscape and measures to enhance it; (b) changes that are needed to improve rural government and its partnerships with the rural population; and (c) reforms and investments that can improve Chinas resources: labor, land, capital, water, forests and the environment of the poor.

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World Bank Policy Note
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Scott Rozelle
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In this report, we will attempt to answer the following three main questions: What economic

and trade policy reforms have been introduced? What have been the impacts of these

reforms on agricultural production and trade? How has domestic food security at the

national and householdlevels been affected by the reform process?

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David G. Victor
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In an article appearing in The Financial Times, David Victor and C. Ford Runge argue that the pending WTO case over genetically modified foods will do the U.S. more harm than good.

America's farm lobbyists have long been pressing their government to launch a formal trade dispute against the European Union's ban on genetically modified crops. This week they got their way, as the US and more than a dozen allies started proceedings within the World Trade Organisation.

For US farmers - the world's top planters of GM crops - the case is a welcome chance to crack open a lucrative market. But the case may ultimately do their country more harm than good.

Now is a particularly bad time to embark on a dispute that will inflame anti-Americanism in Europe. In the broader, already deteriorating relationship with continental Europe, the US has much more important issues at stake, notably reviving the Doha round on trade and mending diplomatic relationships strained by the Iraq war. Moreover, a close look at the options reveals that each of the plausible outcomes from a dispute would leave the US worse off than before.

First, the US could pay the political costs of launching an inflammatory dispute and then lose. Most press accounts compare this case with one of the first disputes ever handled by the WTO: the EU's ban on beef that had been produced using hormones. The EU lost because its ban had no basis in science and in "comparable" areas of food policy it had adopted much less strict rules - a telltale sign that the ban was a protectionist gambit.

On the surface, the cases appear similar. Although the science on the health risks of GM food is contested, essentially all the credible evidence shows that these foods are safe, which would seem to indict the EU ban. But in critical ways the cases differ. Across the board, the EU is tightening food safety regulations in ways that seem irrational by standard cost/benefit tests but, crucially, are broadly non-discriminatory and consistent - the key tests for whether a trade ban is legitimate. Moreover, the GM ban is a temporary measure - unlike the permanent ban on beef hormones - and trade rules allow more flexibility for countries that implement temporary measures when they can claim the science is uncertain.

Second, the EU could change its rules in the middle of the dispute. For several years, EU bureaucrats have been designing a new set of standards that would "reopen" Europe's markets to GM foods if traders complied with onerous tracing and labelling requirements. This shift would make it harder for the US to win because trade laws are tolerant of labels that allow consumers to make the final choice. While the US might respond by dropping the suit, it would be more likely to redirect the dispute against the tracing and labelling rules. In the past, hotly contested trade disputes have usually taken on a myopic life of their own. Each side digs in and the political damage spreads.

Third is the most likely (and worst) outcome: the US could win. The victory would be Pyrrhic because the issues are fundamentally ones of morality and technology - they must be settled in the courts of consumer opinion. On this score, the beef hormones case is instructive. Even today, hormone-treated beef is no more able to find European consumers than it was before the US won its case; and the years of legal wrangling have led to counter-sanctions that have harmed a wide variety of unrelated products and industries. The antagonism over GM foods appears to be unfolding in much the same way.

A better strategy would have been to stay the course that US policy has followed ever since the controversy over GM crops broke out in the late 1990s. Time is on America's side because the technology is already proving itself in the marketplace and European opponents will find themselves increasingly isolated.

But now that Washington has pulled the trigger, what can be done? The greatest danger is that both sides of the Atlantic slide into a tit-for-tat retaliation. But a trade war will cause untold harm to an alliance already in stress and make it harder to rejuvenate the soggy world economy. Cooler heads must prevail.

In Europe, the critical need is to reform the moratorium on GM foods. Frustration over its inability to get the import ban lifted is what pushed Washington to this desperate act. In the US, serious movement in Europe must be seized as pretence to rescind the WTO case before the antagonisms of hearings, judgment, appeal and retaliation unfold.

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11:30 a.m.: "Digital Content Industry in the Information Technology Era" Eiji Tsujimoto, Impress Corporation (Advisor: Harry Rowen) 11:50 a.m. : "Internet Business Strategy for Newspaper Companies" Hiroshi Nozawa, Asahi Shimbun Company (Advisor: Russ Hancock) 12:10 p.m.: "Venture Capital and Entrepreneurship in the Silicon Valley and the Greater China Region" Joseph Huang, AllCan Investment Company (Advisor: Marguerite Hancock) 12:30 p.m. : "How Can Japan Make Effective Industrial Policies For Promoting New Technologies and Industrial Revitalization?" Kosuke Takahashi, Development Bank of Japan (Advisor: Mike Armacost) 12:50 p.m. : "The Difference of Information Strategy Between the USA and Japan" Tatsushi Tatsumi, Sumitomo Corporation (Advisor: Marguerite Hancock) 1:10 p.m. : "Comparative Study of Technology Policy for Small Business Between the USA and Japan" Hidetaka Nishimura, Ministry of Economy, Trade and Industry (Advisor: Mike Armacost) 1:30 p.m. : "How Can China Learn from U.S. Small Business Policies?" Tingru Liu, Infotech Ventures Comapany (Advisor: Harry Rowen) Lunch served to those who respond to Yumi Onoyama by 12:00 noon Tuesday, May 20, 2003. Please contact Yumi via email at yumio@stanford.edu.

Philippines Conference Room, Encina Hall, Third Floor, Central Wing

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The trend for globalization of high-tech industries has gained momentum during the last few years. In particular, the Asia Pacific region has become an increasingly important market for U.S. high tech companies. What investors, both the public market and VCs, look for now are companies with revenue growth and a clear path to profit. The challenge for technology companies and investors is to define the roadmap to weather through the current downturn and build strength to grow when the market returns. The companies that will succeed are the ones that are close to the market, with the ability to produce their products at a reduced cost.

China, with its mass population, is undeniably an enormous market. It not only presents a broad customer base for the high-tech industry, but also an attractive low-cost manufacturing center. There is no doubt that Greater China is a lucrative region to ride the next wave of high-tech industry growth. We all want to capture this golden opportunity. How do we address this huge consumer market? How do we fully utilize the emerging labor support to lower production costs? For venture capitalists, how do we find legitimate ways to get return on our investments?

Taiwan is now China's leading trade partner and investor. Over 25 percent of Taiwan's exports are headed to China, according to the latest official statistics. With its geographic proximity, a well-established technology and business support infrastructure, as well as a common language and similar culture background, Taiwan is well positioned as a gateway to the China. In addition, Taiwan has built a well-recognized capital market in the past three decades. This highly liquid capital market is the best support for the high-tech industry as well as VC players.

In this session, Katherine Jen, a veteran venture capitalist, will lead the audience through her strategy in the quest for the next wave of high-tech industry growth and identify the key success factors.

About the Speaker

Katherine Jen is the managing partner of AsiaTech Management, LLC, a venture capital firm investing in the Silicon Valley and Asia. Katherine's successful venture capital career began in the early eighties. During her two decades in the Ministry of Finance in Taiwan, Katherine ran a $3 billion government investment fund, instrumental in the founding of successful high-tech companies such as TSMC and Moses-Vitelic. She also served on the TSMC board of directors from 1989-1993.

Katherine was one of the pioneers in Taiwan's VC industry. She led many key initiatives in venture capital legislations, including the adoption of the first Venture Capital Act in Taiwan. She helped establish the first group of venture capital funds in Taiwan, including Hotung Ventures, H&Q Asia and Walden International Taiwan (IVCIC). In addition, she founded the venture capital firm Genesis Venture in Taiwan and successfully raised its first fund. As a leader in the Taiwan financial industry, she served on the board of International Commercial Bank of China (ICBC), the largest commercial bank in Taiwan.

Based on the belief that Silicon Valley technologies can find much broader markets if they are combined with the efficient manufacturing industry in Asia, she founded AsiaTech and raised its first fund in 1997. Today, with operations in the Silicon Valley and Taiwan, AsiaTech manages three funds with strong backing from Asian-based manufacturing companies, commercial and investment banks, and government.

Philippines Conference Room, Encina Hall, Third Floor, Central Wing

Katherine Jen Managing Partner AsiaTech Management LLC
Seminars
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C. Richard D'Amato is the vice chairman of the U.S.-China Security Review Commission, a commission established by Congress to review the national security implications of U.S. trade relations with China. Formerly a delegate to the General Assembly of the State of Maryland, he is the president of a consulting firm that represents American corporations on strategic planning and international trade matters. He is also a retired captain in the United States Navy Reserve, a position that brought him a variety of assignments, including attache duty at the U.S. embassy in Beijing, China, on proliferation issues and military-to-military initiatives in March 1997; service in the Battle Group Command Staff of the USS Eisenhower in the Red Sea during Operation Desert Shield; serving as an operations officer directing air drops into Bosnia and Sarajevo; and service on the planning staff of the newly created Asia-Pacific Center, which is a conference and study center under the commander of U.S. Forces for the Pacific, in Honolulu, Hawaii. Recently, Mr. D'Amato served as a member of the U.S. Trade Deficit Review Commission, a congressionally created commission charged with studying the nature, causes and consequences of the United States merchandise trade and current account deficits.

For ten years, beginning in 1988, Mr. D'Amato was the Democratic counsel for the Committee on Appropriations of the United States Senate. He was responsible for coordinating and managing the annual appropriations bills and other legislation on policy and funding of U.S. international operations and programs, including trade and defense and the full range of foreign activities of the U.S. government.

Mr. D'Amato has also served as senior foreign policy counsel for Senator Robert C. Byrd. In this capacity, Mr. D'Amato drafted the resolution that set Senate standards for international global climate change treaty negotiations. He also worked on a wide array of issues affecting U.S. international economic and political interests, including U.S.-Japan auto trade talks; World Trade Organization review legislation; U.S. involvement and funding of operations in Bosnia, Somalia, and Rwanda; and burden-sharing agreements during the Gulf War. Between 1980 and 1987, Mr. D'Amato served as the policy director for the Majority Leader, Senator Robert C. Byrd, for political, economic, and security policies. In this position, Mr. D'Amato supervised all work on a number of important legislative initiatives, including the 1988 Omnibus Trade Bill and the "Super 301" provision. Mr. D'Amato also wrote key legislation dealing with U.S.-Japan economic relations. During his career on Capitol Hill, Mr. D'Amato also served as the co-director of the Senate Arms Control Observer Group.

Mr. D'Amato began his career first as the legislative director for Congressman James Jeffords (R-VT) between 1975 and 1978, and beginning in 1978, as the legislative assistant and then chief of staff for Senator Abraham Ribicoff (D-CT) until 1980.

Mr. D'Amato has been very active in other aspects of public service, including an appointment as an assistant professor of government for the United States Naval Academy between 1968 and 1971, during which he was assistant varsity basketball coach and the sailing coach. He was responsible for the creation of an annual scholarship with the YWCA for college bound African American women and was the chairman of a local charitable hunger relief action organization in 1996, 1997, and 1998, which was a part of the nationwide "Share Our Strength" organization, the most successful hunger relief effort in the United States. In addition, he is active in the boating community in Annapolis, where he and his wife, Dorothy, have lived for thirty years.

Mr. D'Amato received his B.A. from Cornell University in 1964, graduating cum laude in government. He serves now on the Board of Trustees' Council for Cornell University. Mr. D'Amato received his M.A. and M.A.L.D. from the Fletcher School of Law and Diplomacy in Boston in 1967, and received his J.D. from Georgetown University Law Center in 1980.

Daniel and Nancy Okimoto Conference Room

The Honorable C. Richard D'Amato Vice Chairman U.S.-China Security Review Commission
Seminars

The European Forum, in association with the European Union Center of California at Scripps College, is hosting a workshop on "The EU, the US and the WTO" on February 28 and March 1, 2003. The aim of the workshop is to conduct an in-depth discussion in an academic setting about the current state of the WTO, the relationship between the EU and the US and that institution, and the prospects for a successful Doha round of trade negotiations. Invited participants from the US and the EU, including economists, political scientists and lawyers will be at the meeting.

The workshop will address five topics in its sessions. After a keynote address on Friday morning the workshop will look at the WTO as an evolving institution, the EU and the WTO, and the US and the WTO. The Workshop recommences on Saturday at 9:00am, to discuss transatlantic cooperation and the WTO and prospects for the Doha Round.

CISAC Conference Room

Andrew Stoler Speaker University of Adelaide
Richard Steinberg Speaker UCLA School of Law

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Stanford, CA, 94305-6044

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Janet M. Peck Professor of International Communication
Professor of Political Science
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Judith L. Goldstein is  the Janet M. Peck Professor of International Communication and the Kaye University Fellow in Undergraduate Education. She is a member of the AAAS,  is the current chair of the university faculty senate and  the chair of the board for the journal International Organization.  Her research focuses on international political economy, with a focus on trade politics. She has written and/or edited six book including Ideas, Interests and American Trade Policy and more recently The Evolution of the Trade Regime: Politics, Law and Economics of the GATT and the WTO.  Her articles have appeared in numerous journals.

Her current research focuses on the issue of adjustment to global economic shocks, with a focus on employment issues. She has on going projects on tariff bargaining, on foreign policy attitudes and on globalization more generally.

Goldstein has a BA from the University of California Berkeley, a Masters degree from Columbia University and a Ph.D. from UCLA.

Affiliated faculty at The Europe Center
Judy Goldstein Speaker Stanford University
John H. Barton Speaker Stanford University
Bart Kerremans Speaker Katholieke Universiteit Leuven
Anthony Gooch Speaker European Commission
Stephen Woolcock Speaker London School of Economics
Bruce Stokes Speaker National Journal
Mac Destler Speaker Institute for International Economics
Jeff Schott Speaker Institute for International Economics
Richard Morningstar Speaker Harvard University
Timothy E. Josling Speaker Stanford University
Geza Feketekuty Speaker Monterey Institute of International Studies
Dale Hathaway Speaker National Center for Food and Agriculture Policy
John Nash Speaker The World Bank
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