Mainland China offers investment lures

MORRIS CHANG and Wenchi Chen are two of the larger figures of the Taiwanese semiconductor industry. Both travelled abroad for advanced engineering degrees and worked abroad for leading semiconductor enterprises before returning to Taiwan to establish their respective ventures, TSMC and VIA Technologies. Those familiar with the rise of the Taiwanese in the world of semiconductors know that Chang and Chen are not alone. Many dedicated Taiwanese have migrated abroad and sought out experience with cutting edge technologies. Often a decade or more later, they return to Taiwan speaking a foreign tongue, brandishing their foreign engineering degrees, extensive experience abroad and, at times, even a foreign passport. These people painstakingly applied themselves to build bridges between the corporations that develop cutting edge semiconductor technologies and the emerging economic growth in Taiwan.

If a vision of opportunities and wealth abroad often provides the motivation for Taiwanese or mainland Chinese to migrate, that vision of opportunities now leads back to mainland China. The road back to mainland China was apparent on a recent informational tour of investment opportunities in Yangzhou. The tour was organized by the Yangzhou regional government and the Shanghai chapter of the Chinese American Semiconductor Professional Association. CASPA is a professional organization that promotes collaboration among its 100 corporate members and close to 4000 individual members. The informational tour brought together around fifteen semiconductor professionals including two senior technical managers from SMIC, representatives of Taiwanese investment firms with clients like TSMC and Acer and representatives of semiconductor testing equipment providers and design houses.

The purpose of the tour was to introduce investors to opportunities in Yangzhou over the course of a relaxed weekend. Previously, logistical complexities have kept regions like Yangzhou relatively isolated from the economic growth of neighboring commercial centers. In the effort to attract spill over investment from Shanghai or Nanjing, government officials have paid a great deal of attention to ameliorating transportation networks going through the region. Yangzhou now boasts extensive port facilities, a growing network of railway and is surrounded on four sides by highways. A railway to Nanjing is expected to be complete next year. Shanghai is already only a two hour flight away.

Yangzhou is known for its history, a beautiful network of rivers and traditional gardens, lacquer and jade artifacts and its distinctive cuisine. These aspects of Yangzhou were often raised over the course of the weekend perhaps because the informational tour was intended to be relaxing. On the other hand, the mayor specified that the cultural traditions of Yangzhou gave it an advantage over other regions that may also offer low cost labor but cannot provide the quality of life necessary to attract a higher quality of managers and engineers.

Yangzhou is known in modern times as the origin of the one and only, Jiang Ze Min. I probably would have taken this to be tourist trivia if the invitation to the tour had not included bold remarks that Yangzhou government officials are able to offer investors aggressive deals because of their political connections, connections that purportedly lead to the president. Given the importance of regional affiliations in China and the regional pride that is the impetus of many decisions the Beijing government makes, it is certainly possible that Yangzhou will be able to turn a coincidence of birth into something more.

Although Yangzhou is not known yet for its semiconductor enterprises, several three inch and a four inch wafer fab already exist there. The four inch wafer operation belongs to Yangzhou Genesis Microelectronics Company, a three year old joint venture between Japan International Trading Company and the Yangzhou Jing Lai Semiconductor Group. Additional four inch and five inch wafer operations are expected.

For more information about CASPA, visit their website here.

If you have questions about the trip that CASPA took to Yangzhou, contact Dr. Peter Yin at caspa@ix.netcom.com