Gartner said semiconductor revenue in the region would be worth 116.6 billion US dollars in 2007, more than double the 2002 figure of 57.6 billion dollars.

It projected 18.5 percent growth this year with sales of 68.2 billion dollars, thanks to a strong recovery in the second half after the first six months were severely impacted by the Severe Acute Respiratory Syndrome (SARS).

Gartner said China and South Korea would be the clear leaders generating growth in the region.

"Despite the problem due to the SARS outbreak, semiconductor vendors doing business in China-Hong Kong in the second quarter have seen a full recovery," Gartner's principal Hong Kong-based analyst, Dorothy Lai, said in the firm's quarterly report on the industry.

Lai said the China-Hong Kong semiconductor market was expected to grow by 23 percent this year and as much as 30 percent in 2004.

The Gartner report said semiconductor revenue in China-Hong Kong would be worth 28.4 billion dollars this year, rising to 36.8 billion in 2004 and 54 billion in 2007.

Average annual growth for China-Hong Kong between 2002 and 2007 is projected to be 18.6 percent, bettered only by South Korea where sales are expected to grow by 19 percent annually over the same time frame.

"The overall Korean semiconductor market is estimated to reach 12.4 billion dollars in 2003 -- supported mainly by cellular phone, digital consumer electronics products and flat panel display area," Gartner's principal South Korean-based analyst, C.S Kim, said.

"There are a number of new technologies such as next generation mobile communications infrastructure, wireless LAN and wireless personal area networks that promise to stimulate growth in the wireless market over the next five years."

Growth in Taiwan is projected to be 11.4 percent annually until 2007, with the lower growth rate caused by a shift of electronic production to mainland China.

Singapore is going to be hit even harder by the shift of low-end electronic production out of the city-state, with five-year annual growth projected to average only four percent with 3.7 billion dollars in revenue in 2007.

"To reinforce Singapore's competitiveness as a manufacturing hub, the country must continue its drive towards attracting high-end manufacturing," Gartner said in the report.

Neighbouring Malaysia is projected to generate 10.1 billion dollars worth of semiconductor sales in 2007, with an annual growth rate of 11.4 percent.

SPACE.WIRE