Fri, Jul 08, 2011 - Page 12 News List

ProMOS will not affect industry: MOEA

DRAM DEBT:The ministry said the industry was now healthier than three years ago because firms such as Powerchip and Winbond had used new strategies

By Jason Tan  /  Staff Reporter

The Ministry of Economic Affairs (MOEA) yesterday said a financial crisis at ProMOS Technologies Inc (茂德科技), Taiwan’s third-largest DRAM maker, would not have a huge impact because its output makes up only 10 percent of -Taiwan’s DRAM production.

Minister of Economic Affairs Shih Yen-shiang (施顏祥) told reporters yesterday that the ministry is “completely aware” of ProMOS’ moves and it will “render necessary assistance” if needed.

The minister said Taiwanese DRAM makers are grappling with debts, and cutting capital is a viable response.

Amid plunging DRAM prices, Taiwanese manufacturers of computer memory have been in the red in recent years. They have also had to pay high royalties for foreign patents without ownership of technologies.

The minister said the DRAM industry was healthier than it had been during the financial crisis three years ago because some firms have undertaken different business approaches to minimize risks.

He cited Powerchip Technology Corp (力晶科技), which has phased out DRAM own-brand manufacturing to focus on contract production, and Winbond Electronics Corp (華邦電子), which produces niche DRAM instead of the competitive standard DRAM.

The government in 2009 launched a project to revitalize the DRAM industry with fund injections to assist those that are financially troubled.

However, it was scrapped after the legislature vetoed the plan, saying the time to help the DRAM industry had passed as memory prices had rebounded from their low.

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