Semiconductor outlook remains bright despite electronics downcycle : EDB

The Business Times by JANICE HENG


THOUGH the global electronics cycle is easing from its peak, Singapore Economic Development Board (EDB) director for semiconductors Pee Beng Kong highlighted bright spots ahead, with investments made in 2017 and 2018 - by firms such as AAC, ams, RF360, Soitec, Siltronic, SSMC and Micron - expected to continue ramping up in the coming quarters.

The US-China trade war has yet to take its toll, he said.

"Thus far, utilisation of semiconductor manufacturing capacity in Singapore remains high."

Far from their heyday being over, the electronics and semiconductors sectors have been growing as pillars of Singapore manufacturing, he said. Output in the sectors had a compound annual growth rate (CAGR) of about 5 per cent and 8 per cent respectively between 2008 and 2017, increasing their share of manufacturing output from 27 per cent to 38 per cent, and from 15 per cent to 27 per cent respectively over the period.

The long-term outlook is bright given semiconductors' importance in rising technologies such as autonomous vehicles, the Internet of Things and fintech, he added. The global automotive semiconductor market, for instance, is projected to grow at a CAGR of 11 per cent from 2018 to reach US$56 billion by 2025.

The EDB will continue to support investments in new growth markets such as automotive, industrial and artificial intelligence, hoping that these will account for half of Singapore's semiconductor sector by 2030.

READ MORE: As manufacturing slows, diverse factors may drive 2019 growth