United Microelectronics Corp of Taiwan has agreed to construct a US$1bn semiconductor factory in Suzhou’s China-Singapore Industrial Park. The park has agreed to give UMC free use of a 40-hectare site and to halve its 15 per cent corporate tax rate for a decade. UMC declined to confirm the story because the Taiwanese government has not yet formally permitted investments in chipmaking plants on the mainland.
The plant will produce 8-inch wafers on equipment transferred from UMC’s Taiwanese plants, which are installing more modern equipment capable of producing 12- inch wafers. Industry experts said that the attraction of manufacturing on the mainland was to be close to customers in the electronic consumer goods sector.