Japan denied breaking a pact with theU.S. On semiconductor trade but said prices set out in the pact
were too high and acknowledged difficulties in implementing the
accord.
    "We are faithfully abiding by the ... Agreement but of
course there are some problems," a spokesman for the
International Trade and Industry Ministry told Reuters.
    He said the high semiconductor prices recommended by the
agreement were leaving Japanese manufacturers piling up stocks
of unsellable products. "We are aiming to reduce production in
Japan but of course this takes time," he said.
    The spokesman said some Japanese companies were selling
chips in Europe and Asia below stipulated prices, but added: "It
is only a matter of time before we solve this problem."
    The eight month old pact aims to stop Japan selling large
quantities of chips at knock-down prices to the United States
and other countries and to increase U.S. Semiconductor sales in
Japan.
    The U.S. Senate Finance Committee this week called on
President Reagan in a non-binding resolution to retaliate
against Japan for violating the agreement.
 REUTER
