The chief of China's largest contract chipmaker said yesterday that strong domestic demand would help compensate for flat global growth this year.
Richard Chang, president and chief executive of Semiconductor Manufacturing International Corp (SMIC), also complained he was losing skilled staff because of government policies in Taiwan and Singapore.
Incorporated in the Cayman Islands, SMIC produced its first silicon wafers in 2001 and by March last year, it had raised US$1.8 billion in initial public offerings in Hong Kong and New York. In the three months to September, it surpassed Singapore's Chartered Semiconductor Manufacturing in quarterly revenue to become the world's No3 dedicated foundry, according to US researcher IDC.
Mr Chang said strong growth in the mainland market would enable the company to weather a slump in global demand.
'The consumer and telecoms markets are coming together. In 2003, less than 5 per cent of [mobile phones] had cameras, last year it was 20 to 25 per cent and this year it will be 35 per cent. Our revenue will increase this year,' he said.
In light of the slowdown, SMIC would reduce capital spending this year to US$1 billion, from a planned US$1.37 billion, he said. With new plants in Beijing, capacity will reach 140,000 to 155,000 wafers a month by the end of this year, up from 110,000 last year.
He denied Taiwan media reports that SMIC had made sharp discounts to win clients from rivals such as Taiwan Semiconductor Manufacturing Co. 'These reports brought trouble with customers. We do not use cut prices. Our customers sign long-term contracts.'
