The tectonic plate of the Far East and Australasia may be the most seismically inclined of all. China is clearly sweeping up much of the low-cost production which the region has dominated for the last five or ten years. Japan has also ceded that responsibility, its high-wage economy making production in Japan a nonsensical proposition.

Some new engines are revving up just now, such as Telstra in Australia, Telekom Malaysia and Singapore Telecom. It is hard to see how any of these players might cause seismic shocks given that their world views are restricted to their near neighbours in the southern hemisphere.

Instead, those countries such as Malaysia, Korea and Indonesia that concentrate on high-volume production of electronics might still soar. In this ambition they will fear the role of China. The basic economics mean that existing models for ICT development, pegged down from the rates seen in Japan, cannot be sustained once they are pegged up from Chinese levels.

After a few good years the outlook is grim. It is no longer good enough to leverage low-wage economies into a high-value market. Times are not necessarily tough, but they are not tuneful, either.

Rights, wrongs and Richter scales
Techtonix scale/short term: 6/10. Governments are still gradually reducing stakes in operators and manufacturing is strong, despite questions over innovation and durability in production.
Techtonix scale/mid term: 5/10. Tiger economies are less than sabre-toothed, and flat domestic demand cannot paper over the cracks.
Techtonix scale/long term: 5/10. A settled position in the world’s ICT economy.
Jim Chalmers

Next week: an overview of global ICT techtonix – the winners and the losers.