The semiconductor sector of Abu Dhabi’s economy is set to pump US $4 billion (Dh 14.69 billion) into the capital, creating up to 6,000 new employment positions in Abu Dhabi over the next decade according to industry insiders.
High tech industries have been targeted by the Abu Dhabi government as a key factor in diversification outside of the oil industry. Globalfoundries has plans to construct a $6 billion plant close to Masdar City, making Abu Dhabi an important player in the global market for microchips by 2015.
This cutting edge facility will become the “center of gravity” for the region’s semiconductor climate, according to chief executive of ATIC (Advanced Technology Investment Company) Ibrahim Ajami. ATIC is the government agency that backs Globalfoundries.
That tech climate, which includes supplies of equipment, designing and servicing firms, is expected to supply $3 billion to $4 billion of the GDP for Abu Dhabi while also creating 3,000 to 6,000 new job opportunities.
Ajami stated that the last 12 months have seen a strategy develop involving both the Abu Dhabi tech market and Globalfoundries involvement.
The goal is for those two entities to communicate and work together, mainly because Globalfoundries will make up the center of that market and be the main driving force. Abu Dhabi will not only be concerned with creating buzz around the market, hosting events and conferences and being involved in training and education within the sector, the government will also be focused on how to get true value and substance from the industry.
ATIC purchased a stake in Globalfoundries for $2.1 billion back in March of 2008 from Advanced Micro Devices, giving them a majority in the firm. On the roster of microchip foundries worldwide, Globalfoundries currently comes in at number three in terms of revenue. Taiwan Semiconductor Manufacturing Co. along with United Microelectronics are above them, although if Globalfoundries meets their $3.5 billion target for 2010 and next year goes as per plans, they will move into the second highest position by December of 2011.
In a bid to push Globalfoundries up into the lead, ATIC has committed $10 billion in investments including $3.6 billion for existing plant expansion. The balance of the investments is earmarked for the construction of the foundry in Abu Dhabi. The two plants in Singapore and Dresden are currently supplying Globalfoundries operations. Another plant in the state of New York is projected to begin operations in 2012. These three together should record a monthly production of over 200,000 silicon wafers.
Local representatives from Saratoga County in New York, where the Globalfoundries location is under construction, are estimating that the location will create around 6,400 jobs and contribute $300 million annually on average to the economy of the region.
ATIC executives are watching the effects the New York facility has on the local economy in order to apply any lessons learnt to the Abu Dhabi location.
The development in New York in comparable to what will happen in Abu Dhabi, according to the VP and general manager of New York’s Globalfoundries location. Norm Armour stated that Globalfoundries is a “big fish in a small pond.”
The facility in Abu Dhabi is projected to create around 1,500 direct employment positions and 4,500 jobs outside of the facility including suppliers, components and in fulfilling the researching needs of the firm. This location will also prompt the area universities to focus on training Emiratis in the field of semiconductor engineering.
Once the Abu Dhabi foundry is up and running, the firm expects further job creation as partnering businesses surround the facility, according to Sami Issa of the ATIC. These include service firms, equipment and part suppliers as well as design companies stated Issa, the executive director of ecosystem development in Abu Dhabi.
The research arm for the microchip sector, Semiconductor Research Corporation, has signed an agreement with ATIC, working together on the development of relationships between research partners in Abu Dhabi. A research and development centre is also set for construction at Khalifa University of Science, Technology and Research in Abu Dhabi.
Ajami noted that area residents are among the big thinkers and driving architects of the industry and are set to be a key part of the market for the next century.
Considerations are already being tossed around at the ATIC regarding the next location for a Globalfoundries facility, thought to happen around 2020. This development may end up being an expansion of one of the existing facilities in Singapore, Dresden, New York or Abu Dhabi, stated Ajami.
He noted that businesses need to be thinking three to four years into the future to make profitable plans.
Ajami said that in that time period your business will have developed stability and scalability, creating a dependable model you can use for investment decisions. That is ATIC’s goal.Paul Holdsworth, Staff Writer, Gulf Jobs Market News