The country's Ministry of Information Industries (MII) has announced plans to implement a new lead-free requirement for the electronics sector within three years, following similar requirements laid down by import authorities in Europe and North America.

Experts from HIU will work closely with the R&D team of Sun East Technology to advance technologies for lead-free soldering. A recent forum organized by the Group and HIU, and hosted by Mr Gao Zhenjie, Director of Economic Operations of MII（信息產業部經濟運行局高振杰司長） and Professor Qian Yueyu of HIU（哈工大錢乙余教授）, attracted the attendance of over 500 industrial participants and academics from across the country.

Tin and lead are the key material used in the soldering process for electronic products, which have long been identified as a source of pollution. As these products are disposed of and become eroded by acid rain, lead can easily leak out to contaminate water and soil. Children in frequent contact with lead would suffer from permanent mental damage. Authorities in Japan and Europe have already implemented new measures to ban soldering using lead. Lead-free soldering began in Japan in 2000, and by July 1, 2006, all products for sale in the Euro Zone are required to be lead-free. Soldering using lead will be banned in Europe starting from April 1, 2004.

Reports indicate that if electronic products with lead continue to be used in China, the average IQ of Chinese nationals will be 20% lower than that of Americans. Mr Gao told the forum: "China as the world factory is closely observing the trend and understands the urgency for our industrial sector to adopt lead-free manufacturing. MII is in the process of developing a management menu against production pollution for industry participants. Under this new menu, the electronics sector needs to implement lead-free production processes by July 1, 2006."

Mr But Tin Hing, Chairman of Sun East Technology noted: "Lead-free manufacturing is the next wave in the electronics industry. In view of new Government policies, our clients have started to order lead-free soldering machines. Going forward, such orders are expected to grow at a rapid pace. As the largest soldering equipment provider in China, we are committed to facilitating our country's developments towards lead-free manufacturing."

The Group commenced R&D of lead-free soldering technologies in 1999 and successfully introduced its first lead-free model in May 2000. More than 150 lead-free soldering systems have been sold since then, but sustained growth is observed. A lead-free soldering system is on average priced at a minimum of HKD180,000, with a premium of 30-50% over traditional soldering machines. This new product line also calls for more sophisticated technologies and commands higher gross margins.

Mr But continued: "Our lead-free soldering systems are highly competitive as they are priced at around 30% lower than similar systems from Japan. In July, we organized a forum in Xiamen and attracted an audience of 300 customers. Our recent Shenzhen forum was attended by 500 industrial participants. This reflects the potential demand for lead-free soldering equipment, which is expected to provide further impetus for our business growth."

Soldering equipment now contributes 34% of Group revenues. There are currently some 50,000 soldering systems in China, of which 30% were outputs of Sun East Technology. The Group's customers include world-leading electronics vendors such as Panasonic, Samsung, Pioneer, Sony and PVC, as well as major PRC brands Legend, Haier, Sky Worth and Bubugao. Sun East Technology is the only one-stop equipment supplier for PCBs, and pioneered lead-free soldering in China.

"Lead-free manufacturing is the biggest challenge for the electronics industry in China. We are glad to receive strong support from the industry, Government and academics, and will commit further resources to organize forums and promotions on lead-free soldering technologies," concluded Mr But.

About Sun East Technology
Sun East Technology (Holdings) Ltd (SEHK: 365) is a leading electronics equipment supplier in China, offering a full range of surface-mount treatment (SMT), silk-screen printing, soldering, cleaning, coating and logistics equipment. It is the largest soldering equipment supplier in China. The Group operates two production bases in Shenzhen and Shanghai with a total floor area of 76,300 sq m and employing a staff of 1,800 including 300 engineers. The Group became the first ISO9001 accredited equipment supplier in China in 1998.

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