Targeting investment and achieving success in Singapore
04/01/2002
by Swee Nian Lim, Electronics & Precision Engineering Cluster, Singapore Economic Development Board, Singapore
Singapore's semiconductor industry started more than 30 years ago when SGS (now STMicroelectronics), Texas Instruments, and Fairchild set up transistor assembly plants. Other leading industry players followed rapidly, and in just over a decade, the industry entered a new phase with the set up of its first wafer fabrication plant and IC design center by STMicroelectronics.
Today, Singapore is home to more than 60 multinational and indigenous semiconductor companies spanning the full semiconductor value chain of activities. These comprise 32 IC design centers; 15 wafer fabrication plants (12 in operation, 2 under construction, 1 announced in 2/02); and 18 IC assembly and test (A&T) plants, including companies involved in silicon semiconductor, compound semiconductor, and microelectromechanical systems (MEMS). A list of some of the companies operating in Singapore is shown by category in Table 1.
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Besides having a stable political and social environment, the government has focused on ensuring a base of skilled manpower, an excellent communications infrastructure, and an efficient supply chain management industry. In particular, supply chain efficiency is enabled by a transportation system, logistics network, and broadband infrastructure that link one of the world's busiest seaports with the country's airport.
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Singapore's efforts at developing an integrated semiconductor industry have been successful thus far. Table 2 lists the country's actual Vs. target performance indicators for 2001 and Table 3 shows how each industry cluster contributed to the total. The electronics and precision engineering industry cluster was the primary contributor to the value-added per annum (VA pa) total.
Key contributions to the performance of the electronics and precision engineering sector in 2001 were the following:
- DuPont Photomasks in Singapore expanded with a new S$45 million (S$1 ≈ US$0.54669) plant.
- Advanced Micro Devices (AMD) announced that it would build an S$80 million design center and raise investment to S$400 million by 2003.
- Ground was broken for Singapore's first 300mm wafer fab, UMCi Pte. Ltd., a joint venture among UMC, Infineon Technologies, and EDB Investments Pte. Ltd.
- Systems on Silicon Manufacturing Co. (SSMC) opened a joint venture among Philips Semiconductor, Taiwan Semiconductor Manufacturing Corp. (TSMC), and EDB Investments Pte. Ltd.
- Hewlett Packard invested US$100 million in a second inkjet wafer fab plant in Singapore.
- A 60-hectare Wafer Fab Park in North Coast, the fourth of such parks in Singapore, was announced.
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Analysts currently estimate worldwide growth of between 0-3% for the semiconductor industry this year. Though Singapore continues to experience growth in this sector as well, the global slowdown in electronics did cause a few plans to be revisited. For example, in early January of this year, UMC announced that it will delay start-up plans for a 300mm fab by six months.
Four-fold focus
To ensure attainment of semiconductor industry goals, the government has focused on four main areas: manpower development and attraction, R&D support, physical infrastructure, and establishing a base of supporting industries.
Currently, there are significant levels of IC design, wafer fabrication, and A&T training conducted at local educational institutions. Specialist manpower programs for each of these areas are also in place to meet the industry's needs. In 2001, two postgraduate manpower training programs were launched: the Postgraduate Manpower Program and the Research & Training Program. Including students enrolled in other programs, more than 2000 new engineers will be trained over a three-year time period.
In another effort, the Training & Attachment Program, the Economic Development Board (EDB) and sponsoring companies recruit and send university or polytechnic graduates for training, either overseas or locally. On completion of the training, which varies in duration depending on area/course of training, trainees will work with the sponsor companies and/or other Singapore-based companies.
With the limitations imposed by its size, Singapore has made it a policy to welcome foreign talent needed by industry. Living conditions in Singapore are recognized as being among the best in Asia, with good facilities for education, healthcare, and social amenities [1-3].
To support the manpower development efforts, Singapore also invests heavily in its R&D infrastructure, which provides an environment conducive to R&D activities through sharing of ideas and resources. Under Singapore's first S$2 billion National Technology Plan (1991-1995) and the S$4 billion National Science and Technology Plan (1996-2000), research institutes and centers were set up to support industry R&D. Today, the country has 15 research institutes and centers tapping into the S$7 billion fund (2001-2005). The research institutes and centers are supported by about 2000 scientists and engineers engaged in industry cluster activities.
One example is the Institute of Microelectronics (IME). Established in 1991, the IME currently has a staff of about 250. IME develops critical technologies for the entire spectrum of microelectronics: circuit design for communication ICs and systems; advanced semiconductor process technologies; advanced packaging; failure analysis and reliability; and MEMS. Its R&D activities are augmented by strong collaborative efforts with industry and local and overseas universities. The institute also nurtures a vital pool of talent for the industry through various training programs for engineers and technical personnel, scholarship offerings, as well as industrial and student attachment.
State-of-the-art submicron wafer fabrication facilities typically have very stringent requirements, such as low ambient vibration, ultraclean air, a stable supply of electricity, and good quality water. To cater to these needs, Singapore has four specialized wafer fab parks, totaling about 260 hectares, located in the northern and eastern parts of the island. The EDB works closely with private and public sector agencies, such as JTC Corp. (industrial and land issues) and the Public Utilities Board (PUB), to ensure that fab infrastructure requirements are met.
Within the last two years, the government has embarked on a program to ensure competition among service providers for both water and power. The PUB introduced high-grade water for industrial use, which is reclaimed water with a purity level higher than that of normal potable water. The goal is to supply high-grade water to all wafer fabs in the four wafer fab parks in the next 10 years or so. The clustering of wafer fabrication facilities into these wafer fab parks allows the plants to benefit from the advantages of dedicated infrastructure support and services.
Besides transparent government policies, good physical and business infrastructure, and access to skilled manpower, the availability and proximity of good supporting industries are key to facilitating the success of the semiconductor industry. Over the years, Singapore has built up a large base of more than 160 local and multinational companies offering equipment, parts, components, materials, gases, chemicals, and technical services for semiconductor-manufacturing operations.
Conclusion
The semiconductor industry will continue as a key player in Singapore's electronics industry; the government will continue to create an environment conducive to long-term growth in this sector.
The EDB is the lead government agency that plans and executes strategies to make Singapore a global hub for business and investment across manufacturing and internationally traded services sectors. The EDB has 15 offices in major cities across America, Europe, and Asia.
References
1. PERC Quality of Expatriate Living Survey 2001.
2. AsiaWeek's Quality of Life Index (12/2000).
3. William Mercer's World Quality of Living Survey 2000.
Swee Nian Lim is deputy director at the Electronics & Precision Engineering Cluster, EDB, 250 North Bridge Rd., #24-00 Raffles City Tower, Singapore 179101; ph 65/63362288, e-mail [email protected], www.sedb.com.
 Controlling the complex semiconductor process requires both highly skilled employees and specialized equipment. Photo courtesy of Chartered Semiconductor Manufacturing |
Infrastructure matters
Perhaps the most difficult infrastructure problem to tackle in a fast developing center like Singapore is providing a reliable source of high-quality power — required for the 24/7 world of IC manufacturing. Work done by the EPRI PEAC Corp. indicates that even minor voltage sags as short as 16 msec and as shallow as 80% of nominal voltage can cause semiconductor equipment to malfunction. "Over the next five years, the Semi F47 Standard will usher in a new era of compatibility," explains Mark Stephens, engineering manager of the semiconductor and industrial PQ group at EPRI PEAC. "The challenge to electric utilities worldwide will be to invest in improvement — such as building F47-compliant premium power parks — while tool manufacturers are modifying their products to comply with the standard."
By establishing its power grid underground, Singapore did minimize and/or eliminate the effects of such events as lightening strikes, falling trees, car accidents toppling power lines, etc. But, as in any country, power sags are still an issue. "An accident in a factory that causes a propagation of voltage disturbances is enough to shut down a lot of semiconductor processes," explains Deepak Divan, president and CEO of SoftSwitching
Technologies. "Whether above ground or underground, accidents, equipment failures, and insulation failures are a part of life." To improve power quality, Singapore Power Co. established a S$150 million fund to provide 50% cost-sharing with high-tech companies for installing equipment that addresses voltage sags.
World-class semiconductor facilities also need high-grade water. The answer from Singapore's Public Utilities Board (PUB) is "newater" — sewage water that has been treated and ultrapurified. According to reports in the Straits Times (8/31/01), the PUB proved out the concept with a S$6.5 million demonstration plant in Bedok. Newater is purportedly purer than drinking water and is expected to be 10-15% cheaper than potable water.
Another plus is a modern, broadband communications system that promotes efficient communications — very important to an island economy. To ensure access to broadband throughout the country, the Singapore government's National Information Infrastructure (NII) Masterplan was established. Singapore ONE (One Network for Everyone) is a national initiative with the multifaceted goal of delivering a new level of interactive, multimedia applications and services to homes, businesses, and schools. According to the Singapore Economic Development Board, the government invested S$300 million in addition to fiscal and financial programs to support Singapore ONE.
— Debra Vogler, Senior Technical Editor, Solid State Technology
Controlling the complex semiconductor process requires both highly skilled employees and specialized equipment. Photos above and on opposite page courtesy of Chartered Semiconductor Manufacturing
 Singapore's semiconductor industry employs more than 31,000 workers. Photo courtesy of the Singapore Economic Development Board |
Investing in the future
Over the last two years, Chartered Semiconductor generated US$1.5 billion in semiconductor sales to boost Singapore's high-tech economy. "We've taken advantage of the downturn to focus our resources on closing the gap in technology," says Bruno Guilmart, president for Asia Pacific and Japan. "It's a window of opportunity for foundries because many IDMs didn't invest in process development last year and aren't going to do much this year."
The company continues to invest aggressively for the future, despite last year's plunge in the semiconductor market. In 2000 and 2001, it invested US$150 million in R&D. Chartered upped its R&D spending by 11% last year, to US$79.3 million, and plans a 32% increase this year as well, to US$105 million. Total investment in R&D and capital facilities for 2001 was a staggering 119% of sales. The company also spent US$490 million on semiconductor fabs in Singapore in 2001 and plans to spend US$400 million in 2002.
— Paula Doe, Contributing Editor, Solid State Technology