Dataquest Inc, San Jose has put a number on the average reduction of capital spending in Japan on new semiconductor plants and equipment for the fiscal year to March 1993 and reckons the slump will be 29%: one would have thought that the overriding reasons were the state of the world economy coupled with the sudden soaring of the cost of capital in Japan and the unaccustomed pressure on Japanese companies to raise profits and dividends, but Dataquest cites the large production capacity overhang caused by the boom in spending in the late 1980s, and slow adoption of the 4Mb DRAM; Japanese steel companies, late entrants to the game, are expected to cut spending by more than 50%.
