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Global Chip Shortage To Continue Into 2023

The global chip shortage crisis which started with the Covid-19 pandemic is expected to continue well into 2023. High demand for electronic goods and shortage of material has led to low stock availability and increased prices globally. But what is a semi-conductor chip and why is a shortage bad for everyone?

Today’s modern society has become heavily dependent on technology. Semiconductor chips make up a crucial part of our life. They run everything from mobile phones, microwaves, entertainment devices, computers to automated railway systems, aircraft navigation systems and more. And with the current pace of technology development, the demand for semiconductor chips is speedily increasing. The pandemic has affected all sectors of the economy but the chip demand shows no sign of slowing down. This is due to a paradigm shift of office employees who are now required to work from home, an increase in online virtual meetings and online shopping, as well as the demand for electronic equipment.

On the other hand, the pandemic severely disrupted the global supply chain and manufacturing, and many factories were put on lockdown to prevent the spread of Covid-19. Authorities have also enacted tougher restrictions in place to prevent cross-border infections. Adding fuel to the fire is the increased political tension between US and China. But the main bottle neck of semiconductor chip manufacturing is the handful of foundries that produce them.

These few factors play into the grand scheme of things with a great impact on the global chip supply. Now with a crisis on our hands, we can only expect prices of good to increase while supply will have a greater lead time to become available.
If your company is facing a hard time sourcing for IT equipment, feel free to reach out to us at sales@trinix.com.au or called us at +618-83501600. One of our sales team member will assist you.

Sources:
– The Wall Street Journal, 29th Aug 2021 (https://www.wsj.com/articles/covid-19-surge-in-malaysia-threatens-to-prolong-global-chip-shortage-11630234802)
– Bloomberg, 3rd Sep 2021 (https://www.bloomberg.com/news/articles/2021-09-03/toshiba-warns-power-chip-supply-to-stay-tight-for-another-year)

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