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China semiconductor players must strive hard to take the high ground in the development of advanced process technologies, high-value-added chips, and semiconductor and automation equipment, while also finding new niche markets for healthcare, medical, industry and IoT (Internet of Things) applications, according to an industry expert.
Fu Cheng, vice president of Shanghai-based Zhaoxin Semiconductor, issued the call when delivering a keynote speech at a forum held in late October alongside the 2017 China International Semiconductor Expo & Summit at Shanghai New International Expo Center.
Amid the rising de-globalization trend, Fu said, trade protectionism sentiment is gaining momentum, particularly against the semiconductor sector. For instance, the US has expressed concerns about the rapid development of China’s semiconductor industry, in its 2017 Section 301 trade investigation report and may take countermeasures. In addition, tax reduction programs launched by the US and Britain may attract foreign semiconductor players, including equipment and materials suppliers, to return to their home markets with advanced core technologies and tremendous capital funds. These will undermine the pricing advantage of the semiconductor supply chains in China and pose adverse impact on the overall development of the sector in China, according to Fu.
China market as major growth driver
He cited tallies issued by the World Semiconductor Trade Statistics (WSTS) as indicating that semiconductor sales in the US and Europe reached US$65.5 billion and US$37.2 billion in 2016, respectively, falling 4.7% and 4.5% on year. But the corresponding sales in the Asia-Pacific region surged 3.6% to US$208.4 billion in 2016, with the China market serving as the major growth driver.
China’s semiconductor industry had scored double-digit sales growths in 2016 and the first half of 2017, thanks to government policy support and financial backing from the National IC Industry Investment Fund.
Nevertheless, with semiconductor as a technology, fund and talent-intensive industry, the insufficiencies in technological research and development and talent cultivation must be tackled as a pressing issue, Fu opined. As a new wave of startups is emerging in China’s semiconductor industry, how to safeguard intellectual properties and business secrets to prevent unfair competition in the market will be another issue that cannot be overlooked, he added.
At the moment, Fu’s Zhaoxin Semiconductor has teamed up with Huali Microelectronics, Tongfu Microelectronics and Sino IC Technology – all based in Shanghai – to develop a virtual IDM (integrated device manufacturer) operating mode, with the former two firms actively developing 28nm universal process for CPUs, and the latter two responsible for back-end packaging and testing, according to Fu.
Zhaoxin will soon unveil its next-generation KX-5000 series processor, available in 4-core and 8-core architectures. The processor, featuring SoC design with 28nm process, will be China’s first CPU to support DDR4 memory, Fu said.
Fu Cheng, vice president of Zhaoxin Semiconductor.
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