Global Sources, a business-to-business media outfit, wrote up the report after interviewing 322 producers across 10 electronics sectors in Greater China. According to the report, despite the fact that complying with regulations like RoHS (the restriction of the use of certain hazardous substances) pushes up the price of raw materials, at least 50 per cent of suppliers won’t raise their prices more than five per cent, in order to remain competitive and not lose market share.

Mark Saunderson, publisher of the report, reckons that "Greater China suppliers are facing a number of challenges, including higher manufacturing costs and an appreciating Yuan". His report also highlights the fact that 37 per cent of suppliers were concerned about the fierce price competition, 25 per cent of them expressed worries about design copying and piracy, whilst a further 23 per cent bemoaned the rising cost of raw materials.

But, the report says that, despite the challenges, most suppliers remain optimistic about sales in 2008. 39 per cent of them said that they planned to increase capacity by at least 20 per cent. The report revealed that 47 per cent of suppliers primarily targeted the EU with their exports.

Most electronics manufacturers are located in southeastern China; mainly in provinces like Guangdong, Fujian and Zhejiang. From these major production hubs come most of the battery chargers, Bluetooth headsets, DC motors, digital cameras, in-car TVs, IP cameras, PC cameras, media players and USB flash drives, that we have come to depend on in the West.