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Taiyo wins trade-zone status

John Seelmeyer

The formal title Foreign-Trade Subzone Status is a mouthful that only a bureaucrat could love.

Bob White, however, has a shorter term.

He calls it a level playing field.

White, the business affairs manager for Taiyo America Inc.

in Carson City, was all smiles last week after the company was granted Foreign-Trade Subzone Status for the northern Nevada operation.

Here’s what it means for the company, which makes solder used in the production of printed circuit boards: Because the plant is in the foreigntrade subzone FTZ for short material imported into the plant isn’t subject to U.S.

Customs duties.

Taiyo can choose to pay duties either on the raw materials it imports or the finished product it ships.

For Taiyo, that’s an easy decision.

About 50 percent of the raw materials used by the company aren’t physically available in the United States and must be imported either from Asia or Europe.

The raw materials it imports into the plant,White said, carry duties that average about 7 percent.

The finished product, however, carries a duty of about 1.8 percent.

The upshot is this: Taiyo’s foreign competitors can ship finished product into the United States cheaper than Taiyo could make it from imported materials.

“We were being punished for being a U.S.

manufacturer,”White said.

That changes, however, with the FTZ designation.

The Economic Development Authority of Western Nevada sponsored the company’s application, which required the approval of a board administered by the U.S.

Secretary of Commerce.

Foreign-trade zones and sub-zones have been established in all 50 states and Puerto Rico.

The sub-zone approved for Taiyo America is the first of its type in Nevada.

Taiyo America, a unit of a Japanese company, was launched as a sales and distribution operation in Carson City in 1990.

The company invested an additional $4.5 million in the facility in 1995.

The company employs about 38 people.

White said the FTZ designation will provide stability that may help the company’s employment grow.

A far more important factor in employment growth, he said, will be conditions in the electronics industry that use the circuit boards made with its solder.