The Chinese Connection
     Perhaps the most popular goal for high tech in 2000 is scoring permanent Normal Trading Relations with China. A deal has been long coveted by industry, which eyes China's untapped market as having enormous pocket-lining potential.
     "This is far and away the most critical objective. China is a major export market that will increase in importance over the next decade," said Timothy Bennett, senior vice president for international issues at the American Electronics Association. Analysts say it's likely industry will win this issue in Congress, but the battle could be bloody. Labor, human rights and environmental interests largely are opposed to granting permanent NTR status to China.
     Industry also has been doing its share of finger-crossing for China to be admitted into the World Trade Organization. While the United States had struck a deal with China in November, China still must finish bilateral negotiations with other WTO members for entry. This is likely to be further complicated by the contentious breakdown of WTO trade talks in Seattle, and the lack of a new round of negotiations.
     But if China does get admittance into the WTO and U.S. Congress gives it the green light for normal trade relations, it will be a tremendous boon for the high-tech industry.
     "High-tech workers in this country depend on foreign markets for their livelihood," explained Robert Holleyman, president of the Business Software Alliance. "The future of high tech is the international markets."

Looking For A Go On WTO
     Although the tear gas and has long since drifted away from Seattle's downtown, the failed World Trade Organization meeting left the U.S. high-tech industry smarting. In the days leading up to the meeting, all signs had pointed to a win for high tech. The industry had hoped to gain an extension on a ban on e-commerce tariffs as well as reaching agreement on a gradual phase-out of tariffs on certain information technology products. But when talks derailed, the high-tech industry and many other drivers of the U.S. economy, left empty handed. The high-tech community hopes trade talks can be relaunched, but many industry watchers are doubtful.
     "In the case of WTO, it's critical to get the president engaged in global free trade," said Jim Lucier, an analyst with Prudential Securities. "I think we need a stronger level of leadership and, frankly we're probably not going to get it in this election year."
     Still, some are counting on countries to resolve these less thorny trade issues without the WTO's blessing. Bennett said he's optimistic that governments would be able to move ahead on these issues and that industry could help push that along. For example, the American Electronics Association has long sought agreement among participating countries to eliminate tariffs on certain information technology products. Because no agreement could be reached in Seattle, Bennett said the AEA would look for high-tech business to help convince governments to sign off on the deal this year.

Export To Eden
      This week, the Clinton administration released its encryption regulations, which would drastically loosen export controls. The release of the regulations culminates years of lobbying by the high-tech industry. The regulations, which industry initially worried weren't satisfactory, appear to be one of the first major victories for high tech in 2000.
      In addition, high-tech companies are also seeking changes to the government's rules on the export of high-performance computers. Industry observers say the White House could make an announcement about changes to the rules the week of Jan. 17, when computer company executives are scheduled to visit Washington for a meeting of the Computer Systems Policy Project (CSPP), an industry lobby. The White House is expected to further loosen export controls by increasing the performance level of computers subject to export restrictions in certain countries.

A Taxing Issue For High Tech
     Bruce Hahn, director of public policy for the Computing Technology Industry Association, expressed concern that in 2000, developing countries could begin taxing the Internet. With e-commerce growing at a rapid pace, Hahn said it's possible that developing countries, looking to boost their economy, could eye e-commerce or other Net taxes as a valuable source of revenue.
     Holleyman said this could be further aggravated if the United States doesn't reach any consensus on the issue of Net taxes, providing an open invitation for countries to tax the Net.
     "Every country knows that the U.S. has more at stake in e-commerce than any other country in the world," he said. "I think their view will be that if the U.S. can't make it work, then all bets are off."
     Analysts also say they'll watch how the European Union handles Internet taxes. Although the trading zone hasn't acted on the issue, it's expected to take up the proposal for consideration in the first part of 2000.

Business At The Speed Of E-commerce
     Recently, the European Union passed a law giving digital signatures the same legal status as handwritten signatures. EU member countries now must approve the law. The United States is on the cusp of following the EU's move. Australia also has plans to adopt digital signature technology for businesses dealing with government agencies online.
     But high-tech industry worries that with the proliferation of digital signature laws likely to pop up this year, disparate standards could develop and cripple e-commerce. John Dryden, head of Information Computer and Communications Policy for the Organization of Economic Co-operation and Development, said it's important countries use technology-neutral standards when they develop digital signature laws. Dryden, whose organization represents 29 countries mainly in the West, wants to see a global framework for digital signatures led by the private sector that would allow for any type of technology to be used with digital signatures.

Putting It On The Line
     Telecommunications also will play a key international role in 2000, as a nation's telecommunications infrastructure becomes integral to its ability to deliver e-commerce. Eric Nelson, vice president of international affairs for the Telecommunications Industry Association, will look to increase presence in countries such as India, where the nation's telecom sector has seen increasing stability.
     "India is one of those potentially huge markets," he said. "It's very promising."
     Nelson said the U.S. telecom industry would also keep close watch on a move by the United Nation's International Telecommunications Union to dabble in Internet governance. The ITU said in recent months that it has a role to play in overseeing governance of the Internet. But Nelson warned that while the ITU could play a role in creating technical standards for telecom equipment, it should keep its hands off Net governance. "U.S. industries are quite concerned about what they see as an ITU power play," he said. "They are loathe to have a global regulator of the Internet." Currently, various agencies, including the U.S. State Department, are taking comments on the issue.

Thinking Globally, Acting Locally
     Not surprisingly, some of the biggest global concerns for U.S. high-tech companies are intertwined with the decisions of U.S lawmakers in 2000. Robert Holleyman stressed that the United States has a heavy role in crafting technology policy that serve as a model for other counties. "All countries are hungry to know what other countries are doing because they don't want to be left behind," he said. "They look to the U.S. to set the ground rules, not to define the game."
     But Holleyman warned that with that influence comes responsibility and bad policy decisions could resonate around the world. "If Washington gets it wrong, they get it wrong around the world," he said.
- by Caroline Broder