The China Syndrome: ADDRESSING A NEW PARADIGM

摘要

Arecent trip to Asia highlighted many of the issues facing the printed circuit manufacturing and assembly industries, and the challenges facing us. Meetings with suppliers and manufacturers from all over the world and data from industry trade associations indicate that China is the only market to have grown in the current downturn, at the expense of virtually every other market in the world. In addition, recent articles in the general press have highlighted the "giant sucking sound," as manufacturing―especially in our own industry―has shifted to Shenzen, Kunshan, Shanghai, and Suzhou. There are a number of reasons for this, foremost of which is industrial policy on the part of Chinese governmental entities in which subsidies, land grants, tax holidays, duty preferences and non-tariff barriers have all acted to create the ideal environment for growth in the electronic components and manufacturing industries. To an extent, it is a reproduction of the synergistic environment in Taiwan where the entire supply chain lies within a very small radius, with the added advantage of significantly lower costs of doing business. At the same time, poor business conditions globally and overoptimistic projections in the heyday of the Internet boom on the part of management at many of the multinationals has led a stampede in search of lower costs. These factors, combined with significant overcapacity, all challenge the Western and Asian electronics manufacturing industries to a point where we must rethink strategies for growth.