South America Micro Components Market is expected to grow at a compound annual growth rate of 1.16% over the forecast period.
Semiconductor micro components are an essential component of any electronic device, including smartphones, laptops, automated door locks, coffee makers, wearable devices, GPS-enabled pet trackers, mobile phones, and other devices that contribute to creating a network of connected devices. According to The Semiconductor Industry Association (SIA), worldwide semiconductor sales were $41.8 billion in April 2021, a 1.9 percent increase from the $41.0 billion total in March 2021 and a 21.7 percent increase from the $34.4 billion total in April 2020. The global demand for electronic devices has a direct impact on the demand for semiconductor micro components. According to Nunes, president of Smart, the largest Brazilian semiconductor manufacturer, Brazil is experiencing one of its best eras in semiconductor history. According to Associacao Brasileira Da Industria De Semiconductors (Abisemi), semiconductor makers in Brazil were anticipated to conclude 2021 with investments of 250 million reais (US$45 million) and revenues of over 4 billion reais (US$720 million), despite a worsening shortage of chipsets in worldwide markets.
The demand for micro components in the South American region will expand moderately due to the rising demand for cloud storage and data centers in the region. Furthermore, increased internet and communication device adoption in the region is expected to drive market growth over the estimated period. With the approval and publication of Law 14,302/22, which extends the Support Program for the Technological Development of the Semiconductor Industry's incentives through 2026, semiconductor manufacture in Brazil has regained speed (Padis).
Shortage in chips and other components necessary to build semiconductors is increasing the world, as Brazil is facing difficulties in procuring raw materials required to build cars, smartphones, etc.; Positivo, a Brazilian technology firm, established cooperation with Transsion Holdings of China for the exclusive manufacture, sale, and technical support of Transsion's Infinix smartphones in Brazil. Around 50 million reais have been invested in local manufacturing.
Impact of COVID-19 Pandemic:
The COVID-19 pandemic had a negative impact on the market during the first quarter of 2020. Companies in the South American region were disrupted due to the shortage, especially the manufacturing of cars. As a result, various businesses are focusing on increasing their orders and maintaining a stockpile of the required semiconductor components for end-product production to avoid delays in the event of a component shortage. According to Semiconductor Industry Association, markets dropped in 2020 but picked up their pace in march 2021, with sales increasing by 21.7%.
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