[EDITORIALS]Hynix on the brink

Hynix Semiconductor Inc., in an effort for revival, is facing another crisis. The U.S. Department of Commerce issued a preliminary ruling that countervailing duties should be imposed on the chipmaker’s exports to the United States. By deciding to impose the stiff duties, which are equal to more than a half of export prices, Washington has shown its view that Hynix actually depends on the subsidy of the Korean government in producing semiconductors. The United States, in favoring the nation’s chipmakers, seems to be strengthening its unilateralism, which has already become clear through its attack on Iraq, in the trade, too.
The decision to levy countervailing duties on Hynix has been foreseen more or less since the filing against the chipmaker late last year. The U.S. International Trade Commission ruled that Micron Technology Inc. was being damaged by the imports from Korea. In the preliminary determination, the U.S. Commerce Department regarded all the bailout packages that the creditor banks, in which the government had some stakes, provided to Hynix as government subsidies. But the debt reorganization programs for Hynix followed the voluntary decision by the creditors on the market principle.
The problem is that the international trade conflicts have become too fierce, due to a slowdown of the global economy, to accept such claims by us. Accordingly, Washington is likely to raise questions about Korean shipbuilders and paper makers, who underwent similar restructuring programs with Hynix during the 1997-98 foreign exchange crisis.
Since the European Union is likely to issue a similar ruling with the United States on Hynix soon, the business of the chipmaker is expected to suffer more hits. If Washington maintains the decision to impose stiff duties through the main ruling, the competitiveness of Hynix will plummet and its existence will be threatened.
The Hynix problem has deteriorated since the company and politicians blocked the sale of the chipmaker, blowing a good chance to sell the firm. If the troubles are not solved soon, Hynix will cause bigger troubles later.