Asian technology companies are set for a moderate recovery later this year, according to credit ratings agency Standard & Poor's. Bruce Hyman, director of corporate and government ratings at S&P's New York office, said on a visit to Hong Kong this week that S&P had been seeing rising order levels at many of the major components suppliers and manufacturers in the region. The company's latest Asian technology sector report sounded the same theme, highlighting rising orders and average selling prices at Taiwan Semiconductor Manufacturing Co (TSMC), United Microelectronics Corp (UMC) and Chartered Semiconductor Manufacturing. Despite the continuing bad news about the telecommunications sector - including WorldCom's revenue reporting fraud and equipment supplier Alcatel's recent warning on lowered revenue expectations - Mr Hyman said S&P was starting to see increased buying in other industries and in the consumer electronics sector. 'All of these companies who are not telecoms focused are also saying we are seeing signs of increase in demand,' he said. Many technology industry observers have been hesitant to declare that the entire sector is on the mend, and S&P also hedges on the question. 'Some of it [the orders] may be cautious buying on the part of intermediaries, distributors who serve the needs of a large number of second-tier customers,' Mr Hyman said. TSMC, UMC and Chartered Semiconductor, the region's three largest foundries, account for 80 per cent of all dedicated contract manufacturing in the world and were hurt by last year's slump in consumption. Total foundry sales around the world fell 31 per cent to US$7.2 billion, from US$10.4 billion in 2000. Mr Hyman said that S&P believed there would be a small recovery later this year, but growth past previous sales records would probably not happen for another two years. 'Absolute revenue levels are not going to reach their record peak at least until 2004 because we're so far from the prior peak. We're out several years,' he said. When it comes to the WorldCom accounting scandal that shook stock markets earlier this week, Mr Hyman said he did not foresee any major effect on the telecoms equipment industry, which had already seen depressed revenues and uncertain market projections for more than a year. He said that with the probable bankruptcy of another large equipment buyer, 'we're reducing a number with no degree of assurance whatsoever to another unknown number, so I don't think that you can say that it changes the confidence that one has in the projections'.