If the electronics industry is so global, why do regional distinctions continue to be so important?
This question occurred to me when an astute EBN reader asked why optimism among US CEOs was such good news for the global economy.(See: CEOs More Confident, But....) That's not too tough -- the US is a huge export market for every other region in the world. If US CEOs are feeling good about the economy, US consumers may loosen their purse-strings a bit more. If anyone stands to benefit from that, it's Asia.
Then the following press release came across the wire, beginning with:
- Semiconductor Industry Association (SIA), representing United States leadership in semiconductor manufacturing and design, and the heartbeat of American innovation, today announced that worldwide semiconductor sales for 2010 reached a record $298.3 billion, a year-on-year increase of 31.8 percent from the $226.3 billion recorded in 2009. Worldwide semiconductor sales in December amounted to $25.2 billion, a modest decline of 3.0 percent from the month prior in line with historical seasonality, and 12.2 percent higher than December 2009. Fourth quarter sales of $75.5 billion represent a 4.0 percent decline from the immediate prior quarter, and a 12.2 percent increase over the same period in 2009."
More good news for the industry, I'm thinking. Then I read more of what Brian Toohey, president, SIA, said in the press statement:
- "In 2010, all major semiconductor product categories showed double-digit growth year-over-year. As semiconductors have been America’s top export over the last five years, it is important to note that the Asia Pacific region represents 54 percent of the total worldwide semiconductor market. The Americas semiconductor market only accounts for 18 percent of the world market.
“Semiconductor design and manufacturing facilities are strategic to our nation’s economic growth. However, our industry is faced with fierce global competition and our policymakers and regulators must ensure that we have balanced tax, regulatory and trade policies to allow our industry to continue to flourish in the U.S. and remain America’s largest export industry,”
This is a common theme among many of the reports, analyses and forecasts that businesses are releasing of late: we celebrate global growth, but bemoan regional sluggishness. Yes, the US economy could stand more jobs, fewer taxes and a host of other things. And the SIA is representing the interests of its members, which is what it's supposed to do.
But at the same time, we can't rejoice that the global semiconductor market is growing but complain that US dominance of that market is eroding. Electronics is global; we import to and export from every region in the world and as long as one market is thriving -- whether it's the US, Asia, or Europe -- we all benefit from its success.