Semiconductor Manufacturing International Corp. (SMIC) (NYSE:SMI; HKSE:0981), China’s largest semiconductor company and the third largest in the world, aims to achieve $100 million in annual cooperation with Israeli companies by 2010, SMIC president and CEO Richard Ru-Gin Chang told “Globes”. He made the comment at a conference by Deloitte & Touche Technology, Media and Telecommunications, headed by Yigal Brightman, late last week.
Chang sees cooperation with Israel as part of a trend by Chinese companies towards expanding their activities with foreign companies. “The Chinese government is encouraging local companies to acquire or merge with foreign companies, such as the acquisition of IBM’s PC unit, and the failed attempt to acquire Union Oil.
“Our company wants to cooperate with Israeli companies, especially in the manufacture of hardware for the high-tech industry. Development would be in Israel and production in China. I’ve visited Israel several times, most recently in February this year, and met with representatives of very good R&D companies.”
Chang said SMIC was already buying a great deal of equipment from Israeli companies. SMIC also manufactures components for Israeli ADSL, consumer electronics, and telecommunications equipment companies. These company’s activities currently reach several million dollars a year.
In response to a question about the preferred pattern of cooperation with Israeli companies, Chang said, “A lot of space and manpower is needed to create hardware. In this field it is therefore better to carry out R&D in Israel and manufacturing in China, conquering the market together. When talking about software, it’s also possible to carry out manufacturing in Israel.”
Commenting on Sino-Israeli relations in the wake of the Phalcon affair, Chang said, “In the Chinese view, Israel is a very friendly country. The two peoples are friends. We’ve never had problems between us. Jews came to China 1,000 years ago, and China gave sanctuary to many refugees from Europe during World War II. As far as the government is concerned, there are no problems as a result of the affair; none at all.”
Published by Globes [online], Israel business news - www.globes.co.il - on September 19, 2005