The Shanghai Daily recently reported that China's electronic and information sector grew at a slower pace in the first quarter, with growth in fixed-asset investment ebbing further and injection by overseas-funded businesses declining, according to a source at the ministry of industry and information.

During the first three months of the year, major manufacturers in the sector realized 1.06 trillion yuan (US$151 billion) in output value, a growth of 18.6% compared to the same period last year. By comparison, the sector's growth rate was 19.9% for all of last year.

The major electronic and information enterprises injected 50.79 billion yuan in fixed assets in the first three months, up 22.7 percent from the same period a year earlier. The growth rate was 17.3 percentage points lower than the January to March period of 2006 and 5.2 percentage points lower than the same period of 2007.

The Shanghai Daily cites Gao Sumei, an economist of the ministry, who attributed the slowdown to an adjustment period for the sector and the relocation of some foreign-funded enterprises to Vietnam and India. Output of some products, such as CRT TVs, has ebbed, while that of newer products, such as flat panel TVs, is still too small in scale to be able to drive up the whole sector, according to Gao.

About the Author

Hayden Hong, the founder and CEO of Long Circle, has over a decade of outsourcing and consulting experience. Prior to founding Long Circle, Hong was the president and founder of MacaoDude, a consulting firm that counts among its clients Motorola, Nortel, and various high technology companies in the Boston 128 area. In 2005, Hong merged the two companies to provide U.S. companies with low-risk, convenient access to China’s engineering talent, manufacturing industry, and emerging markets. His background includes managing U.S.–China offshore R&D projects for GE, as well as management positions at Broad Reach Communications, a GE partner. Hong received a MSEE degree from Purdue University and a BSEE degree from Northeastern University, graduated magna cum laude.

About Long Circle

Long Circle provides outsourced engineering services to companies whose products and services rely on embedded software and hardware technology. Long Circle and the Long Circle China Center of Excellence enables U.S. companies to reduce costs, increase engineering bandwidth, and broaden market reach by providing low-risk, strategic access to China’s engineering talent, manufacturing industry, and emerging markets. To learn more about Long Circle, visit http://www.longcircle.com.