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Domestic circuit market looking up

THE toughest time for the domestic integrated circuit industry has passed and market revenue will grow this year, though the global IC market is expected to decrease 10 percent in 2009, industry officials said during a semiconductor forum yesterday.

The 4 trillion yuan (US$586 billion) economic stimulus package, the growing 3G market and a government scheme to promote the uptake of home appliances in rural areas will all help boost the chip market, speakers said at Semicon China 2009, which opened yesterday in Shanghai.

China's domestic IC industry revenue will continue to grow at about 3 percent in 2009, said Richard Chang, chief executive of Semiconductor Manufacture International Corp.

Globally speaking, the semiconductor market's revenue will drop about 10 percent in 2009, according to iSuppli Corp, a United States-based IT consulting firm.

"It was the toughest time in December as our plant utilization rate dropped 15 percentage points (from 90 percent to 75 percent). Now the orders are growing each month," Chang said.

SMIC's most recent orders relate to the home-appliance stimulus scheme, in which the government subsidizes certain products, from TVs and air conditioners to computers, sold in rural areas, according to SMIC, the biggest made-to-order chip maker on the Chinese mainland.

The government has also invested heavily to support the high-tech sectors, including the semiconductor, flat-panel display and next-generation mobile sectors, according to Xiao Hua from the Ministry of Industry and Information Technology.

SMIC will start manufacturing based on its next-generation technology in the second half of 2009, Chang said.

Major semiconductor firms, including Applied Materials Inc, attended the exhibition, which will close tomorrow.



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