Integrated circuits industry drives Xiamen’s production

Xiamen aims to become a major production base of integrated circuits (ICs) in China, driven by the growth of electronics industries at the Torch High-Tech Industry Development Zone.

Electronics and machinery are the two pillar industries of Xiamen, accounting for nearly half of the city’s 1,700 enterprises and 70 per cent of total industrial output value of 525.47 billion yuan (HK$ 601.13 billion) in 2016. The electronics industry contributed 198.48 billion yuan to that figure.

With production volume of 126.7 million units in 2016, LED displays remain the major electronics product coming from Xiamen, but the figure fell 13.5 per cent from the previous year. Production of integrated circuits, however, rose 23.2 per cent to 121.76 million units.

Most of Xiamen’s electronics enterprises are in the Torch High-Tech Industry Development Zone set up in 1990. The zone comprises nine industrial parks in different parts of the city, the largest ones being Torch (Xiangan) Industrial Area and Tongan Xiangan New and High-Tech Industrial Base.

The administration of the development zone has stepped up efforts in planning, design, investment attraction, policymaking, and talent training and recruitment.

Various industry clusters have been formed to bring together the manufacturers and their suppliers to improve efficiency. For the IC industry, these include IC design, material and equipment supplies, wafer manufacturing, packaging, testing and applications.

More than 100 IC enterprises have been established in the development zone, and its IC industry has become the sixth largest in China.

From January to April this year, the industrial value of the IC industry in the development zone reached 4.08 billion yuan, up 32.5 per cent from the previous year. The industrial value is expected to reach 12 billion yuan by the end of the year.

The development of the IC industry in the development zone is expected to be driven by United Microelectronics Corp (UMC), Tsinghua Unigroup and Xiamen Sanan Optoelectronics.

These three IC enterprises will develop the supply chain, and other new IC design projects are being planned in the development zone.

UMC is one of the few IC manufacturers in China to have successfully introduced 28-nanometre process technology for volume production of 12-inch wafers, with a yield rate of 94 per cent.

The wafer fab has a monthly manufacturing capacity of 6,000 wafers, which will be increased to 16,000 by the end of this year.