In Malaysia's Silicon Valley, fortunes flip as virus wrecks trade war gains

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In Malaysia's Silicon Valley, fortunes flip as virus wrecks trade war gains
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Roller-coaster ride illustrates how quickly and broadly virus is changing fortunes. FMTNews Epidemic TradeWar Coronavirus Covid19

March 10, 2020 12:54 PM

Pentamaster called alternative sources in Japan, South Korea, Germany and Italy, only to find the action had left them in the lurch too. Home to factories owned by Intel Corp and Broadcom Inc alongside numerous other firms that supply tech majors including Apple Inc, the state accounts for about 8% of global back-end semiconductor output.This year, however, the goal is just a third of that, at about US$1.2 billion – though that is due to the life cycles of investments rather than the virus, the state government said.The roller-coaster ride illustrates how quickly and broadly the virus is changing fortunes around the world.

“Good news: Product transfers from China are leading to more quotation requests and order overflow,” said Goh Guek Eng, managing director at semiconductor products assembler Hotayi Electronic.Hotayi sources 60% of components such as printed circuit boards and multi-layer ceramic capacitors from China, for customers including Samsung Electronics Co Ltd, LG Electronics Inc and Sharp Corp.

Analysts said other firms likely affected by the supply disruption include electronics manufacturing services companies VS Industry Bhd and ATA IMS Bhd as they rely on China for up to 30% of components and material.Semiconductor company Inari Amertron Bhd, whose radio frequency components are used in smartphones including Apple’s iPhones, might have a weak second half after the US firm flagged slowing production and demand in China, Malaysia’s AmInvestment Bank said.

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