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China's total market demand for integrated circuits (IC) will allow Shanghai to establish 10 more IC production lines, officials of the Shanghai IC Industry Association revealed at yesterday's forum held during the 1st Pudong Innovation and Incubation Week.
Zou Shichang, chairman of the IC Industry Association, said: "In the next five years, the growth rate of the IC sector for the whole country is expected to be about 30 per cent year-on-year, while the nationwide market size is expected to more than double."
According to Zou's estimate, the total revenue of the IC sector will add up to 330 billion yuan (US$39.76 billion).
In comparison, China's IC sector turned out 120 billion yuan (US$14.46 billion) worth of IC boards in 2001, 60 percent of which are produced by IC manufacturers in Shanghai.
However, the officials of the IC Industry Association also pointed out that at present, over 85 per cent of nationwide revenue from the IC sector is generated by technologies owned by foreign investors.
"Lack of key technology and intellectual property rights is currently the bottleneck for developing our own IC sector in the city," said Zou Shichang.
He added that a majority of the local IC manufacturers only package and assemble the imported components and devices, with profits depending heavily on the current low labour cost and Shanghai IC companies do not have much core competitiveness.
The association is urging the municipality to encourage more local firms to develop self-owned intellectual property rights.
(China Daily September 18, 2002)
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