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To: Carl R. who wrote (42440)	1/22/1999 12:06:00 AM
From: DJBEINO	Read Replies (1) \| Respond to of 53903

Given all-time high order bookings in December, TSMC is expected to see higher profit and sales in the first quarter compared with the last quarter of last year, Chang said, but declined to elaborate. The global semiconductor market should be able to see a 10-20 pct increase in 1999 after three years of stagnation, he said, adding: "I have a feeling that there should be stronger growth than the market consensus of 10 pct." The Y2K problem is only a secondary factor as it is expected to trigger demand for the replacement of computer equipment, he said, adding Y2K is likely to contribute about 2.0 percentage points to the 10-20 pct increase. More fundamentally, the semiconductor industry will regain momentum on an invariably steady increase in demand in terms of quantity, he said. "The volatile part is prices, which have swung wildly. But the 'slaughter' of prices for dynamic random access memory microchips is about over, ending the recent cycle of plummeting prices. "I don't mean to say there will be no more price drops, but the declines should be happening on a gentler slope thanks to slower capacity expansion in the 1996-1998 period." Chang said he also sees "healthy" growth for the global semiconductor industry in 2000 as he has not seen an upward or downward cycle lasting less than two years. Chang said he does not expect the millennium bug to cause too much trouble for Taiwan as most major companies have taken precautions. "While smaller companies may have paid less attention, their problems are likely to have only a mild impact on the economy." "TSMC started preparing for the Y2K problem one and a half years ago. It should be ... fully ready long before its own deadline of mid-1999."