Electronics Industry Growth Unaffected by SARS
China's electronics industry is on course to become a
global leader in product design and manufacturing, and
is largely unaffected by the recent SARS crisis.
This is the conclusion of a report "Electronics
Industry Outlook: China" released today by eMedia
Asia Ltd.
Electronics sales continued to grow at a brisk pace in
2002, increasing 17.8 percent over 2001 to US$169 billion.
Demand for foreign-made semiconductors continued at a
brisk pace. China imported $44 billion worth of components
and ICs in 2002, while demand for communications chips
jumped 43 percent. Communications chips are largely used
in mobile handsets, phones and network equipment. Double-digit
demand for telecommunications infrastructure equipment
is expected to continue this year as build-out extends
to medium-sized cities across the country. Strong chip
demand is also being driven by deployment of more mobile
base-stations and transmission equipment.
The government's modernization drive has also spurred
government and business purchase of personal computers.
Domestic production of desktop PCs jumped 52.4 percent
to 14.6 million units.
Consumer electronics purchases have also registered healthy
jumps. DVD sales in 2002 jumped by 133 percent over 2001.
The 2008 Beijing Olympics will be broadcast over China's
digital broadcast network, which will further boost demand
for consumer ICs for TVs.
With entry to the World Trade Organization (WTO), restrictions
on foreign ownership of local facilities have been lifted.
Foreign companies can now own 100 percent of these enterprises,
which has spurred foreign investment in research and development
along with new production facilities. Chinese universities
graduate 400,000 engineering students annually. It is
estimated that there are now 200 joint R&D centers
in China, and that number continues to grow.
Weak areas continue to be IP (intellectual property)
protection, and ongoing violations continue to hamper
growth. Also, the comparative lack of experience in international
trade and law leaves open the possibility of continuing
trade disputes.
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