EL SEGUNDO, CA – A new hot spot has emerged in electronics manufacturing: Southeast Asia, namely Singapore, Malaysia, Thailand and – most prominently –Vietnam, says iSuppli Corp.

The Southeast Asian contract-manufacturing market, consisting of EMS and ODM providers, will rise to $24.9 billion by 2011, a nearly $9 billion increase from $16.2 billion in 2006, according to iSuppli. By 2011, Southeast Asia will rise to account for 7% of global electronics contract-manufacturing revenue, up from 6.3% in 2006.

“iSuppli believes that several factors are triggering this resurgent growth among Southeast Asia contract manufacturers, including a backlash against China,” said Adam Pick, principal analyst for EMS and ODM at iSuppli.

Other factors include shifts in the competencies of EMS/ODM providers. Singapore is no longer a low-mix, high-volume manufacturing hub. Rather, EMS providers have migrated up the value chain to offer higher margin services and builds, said the firm.

Government incentives also are playing a role in encouraging the migration of manufacturing to Vietnam and other regions. Government initiatives are stimulating research and development activities by contract manufacturers in Thailand.

As for Vietnam, recent investments by leading OEMs, EMS and ODMs into its industrial parks suggest that Vietnam will ramp quickly as an emerging manufacturing market in Southeast Asia, said iSuppli.
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