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Brazil pushes semiconductor ambitions

Posted: 11 Feb 2010 ?? ?Print Version ?Bookmark and Share

Keywords:Brazil semiconductor industry? wafer fab? chip manufacturing? foundry?

Politicians who packed a stage in sweltering heat to celebrate the grand opening of what they describe as Latin America's first semiconductor fab provided a glimpse into the mindset of the Brazil government-backed play to build a chip industry in the country.

Elected officials who spoke at the grand opening of government-funded startup Ceitec SA's wafer fab described the effort to establish semiconductor manufacturing as a strategically important step in helping transition Brazil to a bigger industrial power, away from its reliance on export of its rich supply of raw materials. While politicians stressed they wanted to lure more multi-national companies to Brazil to establish fabs and other electronics manufacturing facilities, they emphasized the establishment of a Brazil-based IC company as a linchpin in that strategy, facilitating development of the required supplier infrastructure and luring Brazilian engineers based abroad back to their native land.

Brazil President Luiz In�cio Lula da Silva (right) tours the pump room supporting Ceitec's chip fab. Ceitec CEO Eduard Weichselbaumer (center) looks on.

Dilma Rousseff, chief of staff to Brazil President Luiz In�cio Lula da Silva, said the establishment of Ceitec would ensure the transfer of technical chip design and manufacturing knowledge within Brazil. Rousseff, who is considered a leading candidate to replace da Silva when his second term expires this year, said it was critical to lure multinational chip companies to Brazil, but that the existence of a Brazil IC company will reduce its dependency on outside firms.

Rousseff and others said Ceitec would eventually be able to design and manufacture modulator chips to support Brazil's SBTVD DTV standard as well as chips for government-issued passports, drivers' licenses and IDs. She said that Brazil can be among the major economic powers in years to come.

President da Silva said Ceitec would help to reverse what he described as a kind of inferiority complex that gripped a whole generation of Brazilians in the 1980s, when many in the nation assumed that quality electronics products had to be made abroad. Alluding to U.S. President Barack Obama's campaign slogan, da Silva told his fellow Brazilians, "Yes, we can."

Da Silva told the audience that Brazil once had a competitive microelectronics industry, but that it was disassembled in the 1980s due to opposition to state-supported business. He said the government does not generally want to create nationalized businesses, but that it must be prepared to do so in certain instances if the private sector will not.

Da Silva said Ceitec would be critical to helping Brazil bring back Brazilian engineers who are working abroad. Those who left the country because they believed there was no market for microelectronics engineering in Brazil will now look at Ceitec and see that they have an opportunity to apply their trade in Brazil, he said. He said it was "shameful" that the number of Brazilians that studied engineering had been on the decline for many years, but that it is now on the rise.

$250M funding
Ceitec is a startup backed by about $250 million in government funding. The company's wafer fab here is considered modest by modern semiconductor manufacturing standards. It will eventually be capable of processing about 50,000 wafers per year and can support manufacturing down to the 0.35?m node, according to Fabio Pintchovski, Ceitec's VP of R&D. The fab won't be officially in production until late this year.

In an interview prior to the grand opening event, Sergio Rezende, Brazil's minister of science and technology, described Ceitec as part of a multi-step plan to establish a semiconductor industry in Brazil. In the early part of the decade, Brazil started a national program to develop a microelectronics industry and began providing incentives for universities and students aimed at developing more design engineers, he said. The next step was to begin government funding of the Ceitec program (the precursor to the incorporation of Ceitec SA), he said. The final step will be the creation of incentives, including tax breaks, designed to lure multi-national chip companies to Brazil, Rezende said.

Rezende, a long time engineering professor at several universities in the United States and elsewhere, said that the Brazilian parliament has already passed laws that give the president the authority to create financial incentive programs to attract multinationals. "This is in the plan," Rezende said. "But we have to take one step after the other."

A number of contract manufacturers based in South Korea and elsewhere have facilities in a free trade zone established by Brazil in the city of Manaus. Almost all of the components they use are currently imported, Rezende said, but the Brazilian government has the authority to impose conditions requiring that a certain percentage of components they buy must be made in Brazil.

Asked if Brazil could potentially become a global semiconductor manufacturing hub, Rezende responded "Absolutely." He said that the country has made graduating more engineers a priority. While he drew important distinctions between Brazil and Chinachiefly the size of the countries' respective populationshe said Brazil can graduate a proportionally comparable number of engineers. Brazil's population is about 190 million, China's is over 1.3 billion.

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