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China’s Semiconductor Market to Fall 5.8 Percent in 2009 January 23, 2009

China’s semiconductor industry is expected to contract in 2009, the first time a significant decline has occurred since iSuppli Corp. began gathering statistics on the market – and perhaps for the first time in the history of the nation’s chipbusiness. China’s semiconductor market is expected to decline by 5.8 percent to $72 billion in 2009, down from $76.5 billion in 2008, according to iSuppli’s China Application Market Forecast Tool (AMFT). The only previous decline iSuppli recorded was in 2008, when revenue decreased by a scant 0.1 percent – essentially a flat year for the market.

Such a downturn is remarkable for an region long regarded as a vigorous and reliable growth driver for global semiconductor market, Kevin Wang, senior manager of China research at iSuppli. Even during the disastrous year of 2001, when global semiconductor revenue plunged by 28.6 percent, China’s industry managed to surge by 24.4 percent. With global semiconductor revenue expected to decline by 9.4 percent in 2009, and with consumer confidence at risk of falling further, China’s semiconductor outlook could dim even more than iSuppli presently forecasts.Despite this, iSuppli predicts growth will return in 2010, with a smart revenue rebound of 9 percent, followed by an 11 percent increase in 2011. 

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