Japan Agrees to Ease Rules for Computer Project Bids

The United States and Japan on Friday announced an agreement that is expected to open the way for American manufacturers to sell supercomputers to the Japanese government, a market that has been closed to the Americans by a maze of complex bidding procedures.

The agreement, in the form of letters exchanged by U.S. Trade Representative Clayton K. Yeutter and Japanese Ambassador Nobuo Matsunaga, sets forth new bidding procedures that U.S. officials say will require Japan for the first time to live up to international procurement standards negotiated nearly a decade ago.

Yeutter hailed the pact as “an important precedent” that may lead eventually to the sale of more U.S. high-technology products to Japanese consumers and the private sector.

It will also help the Administration counter growing pressure in Congress for protectionist legislation aimed at countries like Japan that run a large trade surplus with the United States and have impediments to U.S. imports.

The resistance of Japanese industry and government bureaucrats to foreign products has been a prime irritant in U.S.-Japanese trade relations

Tacit Acknowledgment

While the deal contains no commitment by Japan to buy new supercomputers--the most powerful and highest speed computer equipment available--from the United States, the fact that there was no U.S. concession in Friday’s accord suggests that Japan tacitly acknowledges that it was not following standards for government procurement agreed on in 1979.

Without conceding that point, Matsunaga told reporters that “in recent years in Japan there has been an awareness of the need to increase imports. This (agreement) is a demonstration . . . to show foreign people that we want to open (our) market further.”

Matsunaga stressed that the agreement is an opportunity, not a guarantee:

“It increases the opportunity of American business. . . . I hope they make their own effort to take advantage of this.”

Yeutter said he is confident that U.S. supercomputer manufacturers will be able to do so. American industry, led by Cray Research and Control Data, both based in Minneapolis, is generally agreed to be “out ahead of the rest of the world” in this field, he said.

Not Fully Satisfied

Yeutter stressed that a separate dispute over the Japanese practice of offering deep discounts of up to 80% on some of their competing supercomputers is still far from a solution. Douglas Newkirk, an assistant trade representative, said talks to deal with that Japanese practice, designed to expand its international market share, are at an “embryonic stage.”

Matsunaga said two agencies of the Japanese government, the Ministry of International Trade and Industry and the Ministry of Education, are each planning to buy a high-capacity computer soon. Those purchases presumably would be the first concrete test of the new bidding procedures.

Symbolism a Big Factor

Sales volume of the supercomputers--defined in the agreement as those capable of performing 100 million mathematical computations per second--is not expected to be large, but the machines have an important symbolic value because they represent the leading edge of computer technology.

Yeutter cited the “multiplier effect” from the sale of such capital equipment--income from service and maintenance contracts, plus software and subsidiary sales.

The supercomputer units cost from $1 million to $20 million each.