To what extent has the SARS epidemic had a negative effect on the
financial performance of high-tech companies in Asia - particularly
China, Hong
Kong & Taiwan?
 
By way of background, I am writting a piece on the the negative impact
SARS has had on the financial performance of these companies. I need
just 1 or 2 paragraphs of succinct well phrased material to include in
the piece.

Hello Clueless1234,
Let me just try to give a summary of what I think basically happened
to China and neighboring regions, and I will list the Internet sites
that gave me the ideas afterwards.

While I think SARS did not bring Chinese companies down to the ground
as formerly predicted, it did affect business and performance in an
adverse manner. Rather than seeing many factories shut down, business
just slowed in a great way, and hopes for bursts in earnings and
business were dashed.

First, because SARS caused travel restriction to be imposed, people
who were supposed to travel, meet and do business were unable to do
so. Executives of technology companies meet to discuss product orders,
set cooperation in product development, promotion events and other
such things, but because of SARS they were unable to do them. Although
they could email each other and do videoconferencing, they were unable
to exchange important documents or do things like signing, to be able
to close deals. Thus actions that wouldn’t earned money or saved a
company from losing money were not done. Quarantines also tied up
people from doing business that had to be done.

Consumer spending habits were affected since, probably in a way that
reduced sales. Technology shops were visited less frequently, so sales
went down. Manufacturing and Research and Development were affected
because people weren’t able to move as freely to do their work. Parts
weren’t moved around as often The threat of SARS also meant increased
health protection measures, such as check ups by physicians and
implementation of sanitation practices, which would cost companies.
Even jobs suffering, especially those in the tourism business.

On the other hand, since people turned to the Internet communication
as a substitute for travel, demand for remote communication devices
increased. Videoconferencing for example would have gone up in usage
and sales this respect. But it won’t mean a big rise in Internet
business. Their survival depends also on company people meeting and
exchanging signed documents. It probably also meant that since more
users were online, servers and lines were clogged, so slowdowns may
have been experienced, depending on the system.

Also, since China was the hardest hit country and was thought of as
the source place for the disease, investments on Chinese businesses
would be reduced, and the economy would suffer a recession. This would
affect the high-tech industry and may product prices as well.

So far, I think the threat of SARS has not been finished. The World
Health Organization does say that the prevalence of the disease is
waning, though its effect are still being felt.

The above is my own analysis actually, but I based them on the
articles from the Internet that I’ve found, which I list here:

SARS Threatens Tax Revenue (05/19/03)
http://www.china-embassy.org/eng/49073.html

SARS triggers downgrade of Asian economic prospects @ workopolis.com
http://globeandmail.workopolis.com/servlet/Content/fasttrack/20030403/RSARS_2?section=Bruce_Little

NEWS.com.au | Tech giants blame SARS (June 12, 2003)
http://www.news.com.au/common/story_page/0,4057,6583333%255E15317,00.html

China’s Economy: Opportunities and Challenges 
http://www.hkcba.com/vancouver/Presentation.ppt

SARS weighs on tech companies in Asia - Computerworld
http://www.computerworld.com/industrytopics/healthcare/story/0,10801,81247,00.html

Will SARS Infect High-Tech?
http://itmanagement.earthweb.com/it_mgmt_trends/article.php/2196551

News: SARS threat crashes Intel events
http://zdnet.com.com/2100-1105-995189.html

News: Chip industry shakes off SARS
http://zdnet.com.com/2100-1103-997304.html

Insurancetech :: Tech Wire :: Asian IT spending seen dropping $1
billion on SARS fears
http://www.insurancetech.com/story/techwire/TWB20030527S0001

Tech Investor: The China syndrome - Jun. 12, 2003
http://money.cnn.com/2003/06/12/technology/techinvestor/lamonica/

Tech Investor: Is SARS sickening tech? - Apr. 10, 2003
http://money.cnn.com/2003/04/10/technology/techinvestor/hellweg/

TheWorkCircuit.com - SARS virus plagues the industry
http://www.theworkcircuit.com/story/OEG20030407S0061

AP Wire | 07/02/2003 | Reports: SARS Costs China Jobs
http://www.philly.com/mld/philly/business/6219490.htm

ZDNet UK - Tech Update – SARS disrupts Asian business plans
http://news.zdnet.co.uk/story/0,,t274-s2132920,00.html

SARS causing business delay and show cancellations
http://www.simmtester.com/page/news/shownews.asp?num=5548

Wired News: Tech Profits Hit by War, SARS
http://www.wired.com/news/print/0,1294,58462,00.html

So my conclusion is that SARS slowed down the tech industry of China
in a big way, but the country will recover once the plague is over.

Google search terms used:
sars negative effect china economy 
sars negative effect china industry

I hope this has been a most helpful answer. If you have any problem
with it, do please post a Request for Clarification and I shall
respond. Thank you.