China cashes in on consumer electronics bonanza

Low labour costs and a fast-growing domestic market will spur China's consumer electronics manufacturing industry to more than double by 2010, market watchers predicted today.

Analyst firm In-Stat reported that the industry will grow from $71.5bn in 2006 to $167bn in 2010.

China's mature supply chain, skilled labour force and convenient logistics are key factors in attracting outsourcing manufacturers from abroad.

"About two-thirds of China's electronics manufacturing revenue comes solely from foreign-funded or Sino-foreign joint ventures," said In-Stat analyst Anty Zheng.

"The world's top 10 electronics manufacturers have all invested in China and consider China to be a key region in their global manufacturing facility layout. "

The newly published In-Stat report estimates that Chinese electronics manufacturing companies contributed about eight per cent of China's total $425bn electronics manufacturing industry revenue in 2005.

Compared to its mature manufacturing environment, the study rates China's R &D ability, especially in chip design and solutions, as weak. Over 90 per cent of chips for electronic manufacturing still depend on imports.

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