Sept. 6, 2007 (China Knowledge) – Intel Corporation, the world's largest semiconductor company, announced its intention for construction of chip fabrication facilities in China and Vietnam, aborting the initial plans for set up in India. This statement was made by Intel chairman Craig R. Barrett, following delays in India to relay its semiconductor policy.
In the same press release, Barrett justified his decision to select China and Vietnam as plans for their manufacturing base have already been laid out years in advance. Amidst his decision, Barrett expressed confidence in China and India to be among the top three economic powers in the world in the next few decades. As such, he foresees more ventures in these countries as Intel expand on its manufacturing capacity.
Apart from leveraging on the low labor costs in various parts of China, the surge of electronics production entering the Chinese market makes it convenient for the chip suppliers to be close to their original equipment manufacturer (OEM), original design manufacturer (ODM) and their electronics manufacturing services (EMS) clients.
In China, the percentage of sales for semiconductor systems exports increased by 60% in 2004 and 64% in 2005.
With this upward trend, semiconductor consumption by the Chinese electronics system vendors increased by 31% in 2005 and the semiconductor industry grew by a strong 35% and was responsible for 90% of growth in semiconductor production globally.