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MAY-JUNE 2020        TAP TIMES          -9-         China’s trade eyes are not only looking
                                                                westward, noted IHS.  Trade routes from
                                                                China to Africa are expected to show a
                   Silicon Valley (from 8)                      marked increase with the highest growth

                                                                expected from the East African to China
        VID-19 virus and Trump administration                   route.
        tariffs.
                                                                Largest consumer
        Continuing trade increase                               Today, China is by far the largest consum-
        Consultant IHS’ World Trade Service fore-               er of semiconductors, research consultant
        cast in 2015 that China’s trade would con-              McKinsey notes, and accounts from some
        tinue to increase by about 5 percent every              45 percent of the worldwide demand for
        year until 2020.                                        chips.

        These export plans were consistent with                 These devices are used in China and in
        China’s Maritime Silk Road trade initiative,            products for export, including smart-
        named after the fabled Silk Road from the               phones, tablets and computers.
        2nd to the 18th Century, connecting East
        and West.                                               China is a late-comer to semiconductor

                                                                manufacturing, some two decades after
        Expanding the New Silk Road also meant                  the rest of the world planted its chip-mak-
        expanding the export capacity for China                 ling flags.
        and other SE Asian countries to larger
        container ships, IHS noted.                             The country “has been playing catch-up
                                                                ever since in an industry in which success
        Current container ships hold about 13,000               depends on scale and learning efficien-
        boxes, but the new ships are able to carry              cies,” said Gordon Orr of consultant McKin-
        20,000 boxes (20-foot equivalent units).                sey.

        Significant headway                                     Building a local industry
         With China’s continued growth, said IHS,               “The Chinese government has made sev-
        “Southeast Asia is making significant                   eral attempts to build a local semiconduc-
        headway.”                                               tor industry, but none really took hold.
                                                                However, now things are changing on both
                                                                the business and policy fronts.”

                                                                Multinational corporations, adds McKinsey,
                                                                “from automotive to industrial controls to
                                                                enterprise equipment—increasingly are es-
                                                                tablishing design centers on the mainland
                                                                to be closer to customers and to benefit
                                                                from local Chinese talent.”


                                                                China’s best-known semiconductor plant, a
                                                                maker of DRAM chips, is ChangXin Memory
                                                                Technologies (CXMT).  The company was
        It’s not only China that wants to emulate Silicon Valley.
        The  State  University  of  New  York’s  Polytechnic  Institute   originally founded as Innotran.  Memory
        in  Albany,  N.Y.  (shown)  and  Utica,  N.Y.  has  become  its   seems to be where the Chinese are head-
        own powerful technology spot. It terms itself, “The world’s   ing first, since these chips are ubiquitous
        most advanced, university-driven research enterprise.)
                                                      (SUNY)    in many products. next page
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