Chinas major foundry: Project
05/01/1997
China`s major foundry: Project "909"
Robert A. Sanford, Innovative Concepts Co.
In a keynote address at the China Electronics Industry Forum `96, held in December, co-sponsored by Solid State Technology, Yu Zhitian, Councilor at the Ministry of Electronics Industry (MEI), discussed the growth of China`s electronics industry. According to analysis of current data, China`s electronics market volume for 1996 will be 320 billion RMB ($1 = 8.3 RMB at the current rate). He projected average annual growth of 20% through the year 2010, reaching 6 trillion RMB in that year.
The electronics industry output is estimated by the Chinese government to increase from 280 billion RMB in 1996 to 700 billion RMB in the year 2000 and 5 trillion RMB in 2010. Yu Zhitian attributes the drive to new demands for electronics technologies originating across a broad front of trades and professions and to the megaprojects for the rapid implementation of an information industry, known collectively as the Golden Projects.
A third important factor was discussed at the same forum by Qian Benyuan, President of China National Electronics Import/Export Corporation. Foreign trade in electronics is a high national priority. From 1990 to 1995, China`s average annual growth rate in electronics exports was 36.1%, compared to a rate of 19.2% for overall national foreign trade. The Chinese leadership understands well that the scale and quality of the electronics industry have become important criteria for measuring development and rank on a global scale.
At the Fourth Plenary Session of the Eighth China National People`s Congress, convened recently, China has listed the electronics industry as "a pillar industry in promoting national economic development." The guiding principles and major objectives have been placed in focus in the "Outline of the Ninth Five Year Plan and Long Term Targets for National Economic and Social Development Through the Year 2010."
The major objectives are "to achieve great progress in the application of modern electronics information technology in the national economy and in various social sectors." China`s domestic market demand for electronics products is also increasing rapidly; it is projected that, in 1996, the computer market reached 70 billion RMB, a tenfold increase from 1991, consumer electronics reached 100 billion RMB, and integrated circuits, 20 billion RMB [2].
Figure 1. Lu De Chun, president of Hua Hong Microelectronics Co. Ltd., (right) and author Robert Sanford visit the "909" construction site at the Pu Dong Industry Park.
Golden Projects
Key to China`s ability to sustain rapid growth in its electronics industry is domestic production of ICs and components. The "909" project represents a significant domestic IC production capability in support of China`s Golden Projects, the mainframe for a new information technology industry. There are currently three Golden Projects of major significance to the country and of highest rank in national priorities.
The Golden Bridge Project is a national public satellite information network that will connect 30 provinces, 400 major cities, ministries, state commissions and tens of thousands of large and medium-sized enterprises, R&D centers, key universities, and colleges [1]. At present the Golden Bridge Project has opened up satellite access to 24 cities and provinces.
The Golden Card Project centers on electronic fund transfer, to include card-based purchases and information media in 400 cities, available to 300 million people. Pilot projects have been launched in 12 areas centered on major cities, and include ATM availability.
The Golden Customs Project aims to speed up foreign trade and connect customs, foreign trade organizations, the foreign currency administration bureau, banks, and the commercial inspection bureau, as well as most import and export corporations.
Figure 2. A view of the Hua Hong fab. Foundations for the cleanroom areas are in place.
IC fab priority
The development of China`s information technology industry is a high priority for the next century. The "909" project and Hua Hong Microelectronics Co. are key elements in this new blueprint (see Figs. 1-5). Located in the Pu Dong Industry Park at Shanghai (Fig. 6), a key district in China`s "Reform and Open Policy," the project enjoys high priority status among 20 major projects in the New Zone.
The development of the New Zone has some remarkable features. Foreign banks can trade in Chinese currency on an experimental basis, and foreign companies engaged in import/export trade are allowed to set up joint ventures in the Zone. Also, other Chinese provinces and municipalities are allowed to set up subsidiaries in the zone, and 60 of them have taken advantage of the new policy.
Major telecommunications and electronics projects include a joint venture for the production of facsimile equipment with Ricoh, a joint mobile telephone project with Siemens, a Motorola project (PABX), an LSI project with Intel at the Wai Gao Qiao Duty Free Zone, and a computer peripherals venture with Hewlett-Packard. Domestic microelectronics projects include the "908" IC final packaging line, a Software Industry Park, and the new "909" project located at the Hua Hong Microelectronics Co.
Figure 3. An architectural model of the "909" facility upon completion.
Following is a recent discussion with Lu De Chun, director and president of Hua Hong Microelectronics Co. Ltd.
Q. Could you elaborate on the history of Project "909" and Hua Hong Microelectronics Co.?
A. On March 29, 1996, China`s State Council approved a key project, the construction of a world-class semiconductor manufacturing facility at the newly developed Pu Dong Industrial Park at Shanghai. A new corporation, Shanghai Hua Hong Microelectronics Co. Ltd., was chartered on April 9, 1996, for the implementation of this project.
Q. What is the size of the projected investment, and how do you plan to acquire process technology?
A. The total investment in Hua Hong is RMB 9.6 billion, about US$1.15 billion. The partners in this project include China Electronics Corporation and Shanghai ED Holding Co. with an additional loan guarantee from the government. The selection process is currently under way for a foreign partner who will contribute process technology and additional funding. In addition to negotiating the transfer of technology from abroad, Hua Hong will be supported by Chinese design institutes, university research centers, and electronic product manufacturers in product development and implementation.
Q. Could you describe the major components of Project "909"?
A. In fact, Project "909" consists of three components: Hua Hong Microelectronics Co. for process and product development and production; selected design institutes and other organizations for design and development; and the General Research Institute for Non-Ferrous Metals for wafer technology implementation.
Figure 4. An artist`s rendering of the "909" administration and office building.
Q. What are the stages for implementation of the "909" project and of the initial products?
A. Hua Hong plans initially to introduce half-micron CMOS process technology in response to domestic and export requirements. The first phase of production targets 6000 eight-inch wafer starts/month, and total production is projected at 20,000 wafer starts/month by year-end 1999. Other processes will also be introduced as the facility ramps up production. Concerning end-uses, the corporation sets priority on the development of integrated circuits for smart cards and communication applications, and microcontrollers for consumer products such as air conditioners. Hua Hong also seeks advanced technology chips for embedded auto applications and for color TV applications. All products will meet international standards in design, as well as performance, and reliability.
Figure 5. The author (far right) and members of his delegation visit the "909" site with Lu.
Figure 6. A view of modern architecture in the Pu Dong Industry Park at Shanghai.
Q. Could you provide some statistics?
A. The complex will consist of 62,000 m2 of buildings (558,000 ft2) with a cleanroom area of 5000 m2 (45,000 ft2) and a total land area of 93,700 m2 (843,000 ft2). The cleanroom will employ automated wafer handling systems, and production flow will be controlled by CIMS. The total employment is projected to be about 700. Tool selection is a function of the process technology and the experience of the foreign partner. It is envisioned that the placement of tool orders will follow fairly quickly once the partner negotiations are completed. Hua Hong plans also to establish two or three joint design companies abroad to provide international market orientation and to contribute to new product development.
PETER N. DUNN is the editor and publisher of WaferNews, the semiconductor manufacturing industry`s premier weekly news publication. For more information, check the WaferNews web site, http://www.wafernews.com, fax 603/891-0597, e-mail [email protected].