The worst may soon be over when it comes to disruptions stemming from the global chip shortage, according to Goldman Sachs.

Andrew Tilton, chief Asia economist at the bank, said the situation could improve in the second half of 2021.

He said there have been “noticeable tightening” of supply chains and shipment delays in North Asian economies such as Japan, Taiwan and South Korea, which are involved in the semiconductor supply chain.

“That will have an impact on downstream sectors. Auto production is one of those,” he told CNBC’s “Street Signs Asia” on Monday.

“Our analysts believe we’re probably in the worst period of that right now. That is, we’re seeing the biggest disruption downstream (in) industries like auto right now and that will gradually ease over the back half of the year,” Tilton said.

Still, Goldman’s Tilton said the situation is worth monitoring, especially if other disruptions in the supply chain emerge.

“There was a lot of concern in Taiwan that droughts or the resurgence of a new Covid outbreak there could result in a significant shortfall in production. So far we haven’t seen that,” he said.

Chip manufacturing plants use huge amounts of water daily, and Taiwan, home to the world’s largest contract chipmaker, is facing its worst water shortage in 56 years. On Sunday, the island lifted some water restrictions after a recent bout of heavy rain, Reuters reported.

Taiwan is also dealing with a Covid outbreak that emerged in May after it successfully kept the virus at bay for most of the pandemic.

“There’ve been a couple of isolated disruptions, but so far, not enough to cause a major disruption to the semi supply chain,” Tilton said.

It remains something that needs to be watched closely in the coming weeks and months, he added.