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Beijing And Shanghai Vying for the Chip Throne
China's capital city and its economic powerhouse Shanghai recently started to compete to claim the throne of China's semi-conductor industry.
The construction of two semi-conductor production bases was started in the two cities in November and December respectively, and both claimed they would become flagships for the country's chip-making sector.
The Shanghai Grace Semiconductor Manufacturing Corp Ltd, which was established with US$1.63 billion from both overseas and Chinese investors, is being built in the Zhangjiang High-Tech Park of Shanghai.
Officials with the Shanghai municipal government said the city has decided to make the Zhangjiang High-Tech Park China's prime semi-conductor production base. This will be achieved by establishing 20 integrated circuit manufacturers there in the coming 10 years with a combined annual output valued at billions of yuan.
However, the construction of another mass chip production base, the Huaxia Semi-conductor Manufacturing Co, began in Beijing a month after the Shanghai base.
The company is co-funded by the Shougang (Group) Corp, one of China's largest steel makers, the Beijing State-owned Assets Managing Co Ltd and three US semi-conductor producers.
As the major investor, Shougang said the total investment going into the chip base will reach US$10 billion by 2010.
Industry insiders said the two bases are the same. They will both focus on 8-inch, 0.25-micron computer chips and they will both start operation in 2002.
The two companies will each have a production capacity of around 40,000 chips per month, according to the two bases.
Analysts said that although the two companies are producing the same products, they will not hurt each other, as the market is huge.
"Beijing and Shanghai do not need to fight for the No 1 position, both of them have rosy prospects because of the country's increasing use of computer technology," said a researcher with the China Software Industry Association, who declined to be named.
In accordance with the rapid development of information technology in China, the country has become one of the biggest semi-conductor importers in the world.
Source: China Daily
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