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SINGAPORE: The tech sector in Asia could receive a boost if recent economic proposals by US President Barack Obama are passed.
According to experts, they said his measures will help increase US consumer spending and boost demand for Asian tech exports.
But overall though, they are reining in their expectations on a huge spillover effect.
Recent proposals by US President Barack Obama to boost economic growth have been met with both support and criticism.
The proposals include a plan worth US$50 billion to upgrade infrastructure and tax breaks that could help companies save some US$200 billion over two years.
There could also be tax cuts for Americans earning under US$250,000 per year.
Analysts said these measures could potentially be positive for Asian economies especially the tech sector with US consumers in a better mood to spend.
Wong Sui Jau, GM of fundsupermart.com, said, "Tech products are not so expensive such that it will hold people back. They won't buy a new house or things like that but certainly a new fancy tech gadget is well within [the] reach [for] most people who have been going on a frugal spree for a fair number of months.
"Asia generally is in the entire supply chain so this includes everything from semiconductor chips. That is why you have the prices of D-ram chips actually going up to well US$4,000 over now. Of course, there will be other electronic products which Asian companies help to manufacture."
But some observers are keeping their expectations low on the extent of a broader boost.
The jury is still out over the overall impact of the previous bailout package during the financial crisis which had cost about US$800 billion.
They say the latest package is just a fraction of that, and has been described as a small drop in the ocean considering the US economy is worth about US$14 trillion.
David Cohen, Director of Asian Economics, Action Economics, said, "I don't think they're going to put too much stock into it. [It] probably won't have that much effect.
"If they were to pass it, we'd say it's relatively modest compared to the original stimulus package from a couple of years ago of US$800 billion. A lot of it is political posturing, to give the Democrats a rallying point in the elections in November and the Republicans might not even allow it to pass the congress."
The proposals from the White House come amid the final leg of campaigning in the lead up to the mid-term congressional elections.
Observers said the plans are unlikely to be passed before that. - CNA/fa
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