*NEWS*NEW SILICON BORDER IN MEXICO !

[Anonymous]

Investors Bet on Silicon
Border in Mexico

MEXICALI, Mexico
 On
an empty stretch of Mexican desert where nobody but cowboys now roam, developers
see a new, $1 billion high-tech industrial park dubbed the “Silicon Border.”

California-based developers hope the
chip manufacturing and assembly complex, located just south of the U.S. border,
will become a new hub of the North American semiconductor industry and take
advantage of Mexico’s cheaper labor costs. The 15 square mile patch outside Mexicali is relatively
close to the corporate headquarters of U.S. high- tech companies and will
compete with China and Taiwan in the $200 billion global semiconductor industry.
“The project aims to capture some of
the new capacity in the semiconductor industry,” said Ron Jones, the president
and chief executive of Silicon Border Development, the California- based
developers behind the project.
“More and more of it is going to Asia and we believe it
is prudent to have a parallel supply chain in North America,” he told Reuters in
a telephone interview. Mexico has had problems attracting high-tech companies
due to relatively low education levels, plus energy and labor costs that are
often much higher than Asia’s. Elsewhere, large-scale semiconductor projects
such as Dubai’s “Silicon Oasis” have disappointed in the past
Still, Mexican authorities have pledged 10-year tax
breaks to hi-tech companies locating to the site, which is just a two hour drive
from San Diego, in an area with abundant water, power and gas supplies, Jones
said.
A STONE’S THROW FROM BORDER

Jones said the science park aims to woo a variety of hi-
tech businesses, including semiconductor and flat panel display makers, as well
as contract chip manufacturers known as foundry plants.

It wants to create 100,000 jobs for Mexican workers and
U.S. commuters slipping over the border each day.

The group is negotiating financing of between $100
million to $125 million to break ground on the first stage of the five- step
project as soon as August of this year. Business leaders in Mexicali, which has 600,000
residents and three universities, have embraced the project, which they say will
add value to the traditional export assembly plant or “maquiladora” model.
<>“They are looking for engineers and designers … and
not just intensive labor … so it would bring real economic benefit to
Mexicali,” Federico Prieto, the president of the Mexicali Economic Development
Advisory Council . Industry analysts are also hopeful.

“There is a danger that we could lose a lot of our design and
research activities to be closer to the manufacturers in China and Taiwan,” said
industry analyst Risto Puhakka of VLSI Research. “In terms of North American
competitiveness … we’d be delighted to have it succeed.”

[Author]

February 22, 2005 at 10:52 AM