Dubai unveils plan to build $1.7B silicon fab

Dr Mohammed Al Zarouni, director general, DAFZA, has unveiled an ambitious plan to make Dubai a global hub for semiconductor research and production.

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By  David Ingham Published  October 12, 2002

Dubai Airport Free Zone Authority (DAFZA) has outlined ambitious plans to construct a $1.7 billion semiconductor manufacturing facility in the emirate. The fab will form the centrepiece of what has been dubbed ‘Dubai Silicon Oasis’, a proposed centre inside the free zone for companies dedicated to semiconductor research and production.

“Our vision is to make Dubai Silicon Oasis the world’s foremost centre of silicon intellectual property creation and knowledge through high technology initiatives,” said Dr Mohammed Al Zarouni, director general, DAFZA. “Dubai Silicon Oasis will create the most comprehensive, integrated high quality environment for technology leaders across the semiconductor value chain.”

It was revealed on Saturday that the factory will be built as part of the Dubai Government’s investment in a German company called Communicant. Other investors in the company are Intel and the German State of Brandenburg.

Communicant is currently constructing its first plant, at a cost of US $1.3 billion, in Frankfurt, Germany. Should demand be strong enough, the company will build its second plant in Dubai Silicon Oasis, with construction tentatively scheduled for 2006.

All parties were vague on the crucial question of where combined funding of $3 billion will come from. The semiconductor manufacturing business is also notoriously volatile, but Communicant claims it will succeed by using a revolutionary new manufacturing method, endorsed by Intel, that adds carbon to silicon.

The plant will create up to 1500 jobs and technology transfer is a key component of the Dubai government’s deal with Communicant. 250 UAE nationals will study microelectronics in Brandenburg universities over a ten year period and spend time in Communicant’s Frankfurt facility.

As to how ambitious Communicant’s plan truly is and how likely it is to come off, Abbas Ourmazd, CEO of Communicant, offered the following: “There is currently no semiconductor manufacturing facility between Seattle and Singapore. The project we are talking about will create a world class foundry in Europe and one in Dubai. We are talking nine out of ten for difficultly.”

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