S. Korea`s semiconductor exports fall for third straight month

SEOUL, Oct. 5 (Yonhap) -- South Korea's semiconductor exports fell for the third
straight month in September, hit by oversupply and a U.S.-led global economic
slowdown, according to government data reviewed here Sunday.

Semiconductor exports, which account for about 25 percent of the nation's total
information technology exports, declined 9.9 percent from a year earlier to
US$2.96 billion last month, the Ministry of Knowledge Economy said.
South Korea is home to the world's largest flash memory chipmaker, Samsung
Electronics Co. The world's two biggest suppliers of dynamic random access memory
(DRAM) chips, Samsung and Hynix Semiconductor Inc., are also based here.
U.S.-based research company iSuppli Corp. warned Saturday that DRAM makers, which
are reeling from a major downturn in business conditions, face difficulty in
securing capital due to a credit crunch in the U.S.
"Even with the expected intervention by the U.S. government, this crisis means
the cost of capital will rise because cash-strapped banks will be reluctant to
take on big, risky ventures," said Kim Nam-hyung, a chief analyst for iSuppli.
"This is a particular challenge for the capital-intensive DRAM manufacturing
business," Kim said.
Kim warned that some DRAM firms will face serious liquidity issues in the near
future, based on the pace of their cash burn and the maturation of their
short-term debt.
"DRAM suppliers that already are facing cash issues soon may not be able to
service debts that are coming due soon," the analyst said. "Furthermore, DRAM
suppliers may encounter problems in trying to finance their capital
expenditures."