Concerns that an expected recovery in the electronics sector may be delayed prompted a technology research firm yesterday to slash by half its forecast for next year global semiconductor sales.
However, Asia will emerge as the "shining star" in the microchip sector next year, according to the Gartner research firm.
Revenue from sales of semiconductor chips worldwide is currently expected to grow between 9 percent and 11 percent next year, Gartner said in a report, down from the earlier prediction of 22 percent.
Corporate governance issues, the slower pick-up in the US economy and the turmoil in the Middle East were cited as factors that motivated the firm to lower its forecasts, said senior analyst Dorothy Lai.
"Visibility of a recovery is only expected in the first half of 2004," she said.
a silver lining
The silver lining is the Asian semiconductor market. Lai said she expects Asia to be the "shining star" from next year, as more electronics manufacturers are expected to relocate to the region, particularly to China.
Gartner estimated the total value of the semiconductor market in the region this year will be US$46.4 billion.
"Many electronics manufacturers are moving into Asia as they move out from places such as Ireland, Germany and the US because they need to reduce costs and access a larger market," Lai said.
Asia can also provide better logistics than before, she said, and the level of technology will be able to support the manufacturing of high-end semiconductor chips.
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