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Transcript of Speakers Indrek Grabbi Semiconductors Brad Hess Market Development Cooperator Program Office of...
For US Government Use Only 1
Speakers
Indrek GrabbiSemiconductors
Brad HessMarket Development Cooperator Program
Office of Planning, Coordination, and Management
Information Technologies TeamOffice of Health and Information Technology
Dorothea BlouinSemiconductor Mfg. Equipment
For US Government Use Only 2
Market Development Cooperator Program
Partnering to generate exports
For US Government Use Only 3
Market Development Cooperator Program (MDCP)
Cooperator
Targeted foreignmarkets
$300,000 Trade associations
Each year the International Trade Administration (ITA) selects 7-9 trade associations and other non-profits industry groups for awards of up to $300,000 each.
MDCP award recipients, “cooperators”, design projects to help small firms (SMEs) to export to targeted foreign markets.
Project activities vary depending on the industry a cooperator is helping and the markets targeted. Examples include:
- Participating in foreign trade shows- Opening a product demo center- Coordinating industry standards
SMEs
SMEs export
Cooperator
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MDCP first authorized in 1988, funded in 1993
Enabling legislation:Omnibus Trade and Competitiveness Act of 1988:MDCP is to be a unique way to "develop, maintain and expand foreign markets for nonagricultural U.S. goods and services." 15 U.S.C. Sec. 4723
Funding: Jobs Through Exports Act of 1992 andFreedom Support Act of 1992:First MDCP awards, totaling over $2 million, were made in fiscal 1993
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MDCP is a very cost effective way to help U.S. industry to export. For every $1 in MDCP award made, MDCP projects generate $327 in exports.
MDCP is a tool ITA can use to engage U.S. SMEs by partnering with the industry groups that represent them.
ITA staff at headquarters and in the foreign and domestic fields can all leverage MDCP by:
- Recruiting industry groups to compete for awards - Debriefing unsuccessful MDCP applicants
- Participating on MDCP project teams
Message to U.S. industry groups: Want to grow? Export
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Cooperator
MDCP Public-private partnership
ITA .
Trade associations Chambers of commerce State trade departments Other non-profits
MDCP encourages industry groups to partner with ITA
Targeted foreignmarkets
Export multipliers: industry groups that do not export, but whose companies or business constituents do export
Cooperator projects strengthen the global competitiveness of a U.S. industry, not just a particular company
Each MDCP project team includes ITA and other federal specialists who work shoulder-to-shoulder with a cooperator
SMEs export
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Market Development Cooperator Program (MDCP)
CooperatorOther federal
agencies
I&AIndustry & Analysis
GMGlobal Markets
Project activities helpsmall U.S. firms export
Targeted foreignmarkets
Non-profit industry groups compete for MDCP awards from ITA:
Up to $300,000
Partner w/federal agenciesen
Applications due: Februaryen
“Cooperators” commit to:
Projects to engage small
. firms in exporting
Term: 1-3 years
Two-thirds of total cost
Joint team coordination
$1
ITA .
Trade associations Chambers of commerce State trade departments. Other non-profits
Report export results
Project-generated exports per $1 of MDCP award
Product demo centerTrade mission Technical seminar
Foreign trade showIndustry standardsForeign rep office
$327Report export results
Evaluation Criteria
20% Potential to generate exports that . . . . . create or sustain U.S. jobs
20% Export performance measurement
20% ITA partnership & priorities
20% Creativity & institutional capacity
20% Budget, match, sustainability
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MDCP application evaluation, debriefing, awards
GMGlobal Markets
I&AIndustry & Analysis
-Foreign posts-U.S. Export Assistance Ctrs-Area experts
-Industry specialists-OPCM/MDCP
MDCP Merit
Review Panel I&A
Assistant Secretary
Top ranked
Unsuccessful applicants
Award announcement: -Members of Congress-DOC press release-Orientation-Industry events
-Industry specialists-OPCM/MDCP
Comments
20% Potential to generate exports that . . . . . create or sustain U.S. jobs
20% Export performance measurement
20% ITA partnership & priorities
20% Creativity & institutional capacity
20% Budget, match, sustainability
Applications due: February July-August
Evaluation
Debrief
September
GMGlobal Markets
-Foreign posts-U.S. Export Assistance Ctrs-Area experts
I&AIndustry & Analysis
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MDCP federal teams help cooperators achieve export success
TV Standards for Latin America
Apparel to Japan
Graphics Equipment to India
An FCC expert works with ATSC Forum regarding Latin America’s adoption of a high-definition TV standard. Within days of Mexico’s adoption of the ATSC standard used in the United States, U.S. manufacturers were selling new transmitters and other HD-TV equipment.
ITA industry and Commercial Service specialists helped NPES set up an office in India, which helps member companies, such as Martin Automatic, Inc., facilitate sales.
ITA’s North Carolina-based Export Assistance Center, and Washington, DC-based industry experts help the Hosiery Technology Center translate use of a quality seal into sales to choosy foreign consumers.
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MDCP federal (ITA) project teams
CooperatorOther federal
agencies
Project activities helpsmall U.S. firms export
Targeted foreignmarkets
Joint team coordination
$1
Report export results
Project-generated exports per $1 of MDCP award
Product demo centerTrade mission Technical seminar
Foreign trade showIndustry standardsForeign rep office
$327Report export results
Teams formed: August-September
MDCP project duration varies: 1-4 years
CS harvests export successes from quarterly reports
Regular meetings and informal coordination
Pre-event participant list to USEACs
Each MDCP project team includes staff designated by I&A and GM
Initial meetings w/new cooperators at September orientation
Currently 168 ITA staff serve on 22 MDCP project teams
I&AIndustry & Analysis
GMGlobal Markets
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Over the years cooperators have targeted 70 different markets (only the top 40 appear in the tag cloud above)
China has overtaken Mexico as the market most often targeted by cooperators
Gaining in popularity: Brazil, UAE, Indonesia
Markets targeted by cooperators
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Cooperators 1993-2013: 128 awards to 101 industry groups
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Commitment and sustainability
A cooperator must commit to provide at least two thirds of the resources required to undertake the project
At 67% of project cost, MDCP’s cost share requires commitment
Minimum requirement
Actual
0% 20%
40%
60%
80%
100%
67%
73%
33%
27%
CooperatorITA
Still operating today
Continued after MDCP
project
Footholds undertaken
0 2 4 6 8 10 12 14 16 18 20
14
16
18Sustainability is evident in the foreign presence (foothold) that we have helped industry groups to establish abroad *
_______________________________________________
* Does not include three established in 2013
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Generating exports takes time and commitment
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MDCP Printing & graphics equipment to China
Chinese Dealers Learn About U.S. ProductsITA helped NPES establish a training center in China. U.S. firms that are members of NPES use the Shanghai facility to train sales reps and technicians in China.
Troy Greenwald, of Connecticut-based inc.jet Inc., shows potential dealers how his firm's ink jet engines work. The demonstration is one of many that take place each year at the demonstration center of MDCP partner NPES.
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MDCP RVs in China, Japan, Korea
Temp Solution for PermsThe Recreation Vehicle Industry Association (RVIA) received $300,000 in MDCP. One year into the project, RVIA has now hired a full-time representative who lives and works in East Asia. To date the project has generated $7 million in exports. Sales measured in hundreds of millions of dollars per year are on the horizon, especially in China, but not until China addresses standards and regulatory issues. Through the MDCP project, ITA is helping RVIA remove barriers.
RVIA helped a member company sell this temporary beauty shop that replaces one destroyed in the recent tsunami.
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MDCP specialty auto equipment to Gulf States & China
Measuring session & trade showsITA is helping the Specialty Equipment Market Association (SEMA) boost export to the Gulf States and to China. Rules on what is “street-legal” and who is authorized to customize a vehicle, e.g. vehicle manufacturer or local auto shop, are issues SEMA is addressing with ITA’s help.
U.S. specialty auto equipment makers measure a Toyota Hi-Lux 4x4 truck. ITA helped SEMA get special permission to import the truck temporarily in the United States. The vehicle is not authorized for U.S. sale but is the highest selling vehicle worldwide that is likely to be customized.
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Brad HessDirector, Market Development Cooperator ProgramIndustry & Analysis1401 Constitution Ave., NW, rm 4320Washington, DC 20230T 202-482-2969M 202-384-0491
Market Development Cooperator Program
(MDCP)
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Industry and Analysis’Spotlight on Semiconductors &
Semiconductor Manufacturing Equipment
April 23, 2014
Prepared by Office of Health & Information Technologies
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Semiconductors Semiconductors: Semiconductor and Related Device Manufacturing -- Fabs, Foundries -
(NAICS 334413) Semiconductor Design or Fabless (NAICS 334413, SERVICES, WHOLESALE).
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Semiconductor Manufacturing
Design
(Fabless, IDM)
Semiconductor
Fabrication (Foundry, IDM)
Test Packaging/Final AssemblyIDM: Integrated Device Manufacturer
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Semiconductor End Use Applications• n
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U.S. Semiconductor Industry• U.S. Company Leadership: U.S. companies recorded sales of $155 B in 2013
and had a 51 percent share of the $306 billion global market
• Jobs: Employs 245,000 jobs directly and supports more than one million additional U.S. jobs
• Strong and growing domestic manufacturing base: majority of production from U.S. companies is located in the U.S.
• One of the nation’s top exports: along with autos, airplanes, and petroleum
• Intellectual Property: World class; in 2012 U.S. companies invested $32 billion in R&D, totaling 22 percent of total sales; cutting edge university research
• Small and Medium Sized Companies: Especially in semiconductor design (fabless companies)
*Source: Isuppli 2013 Projection; **Semiconductor Industry Association, BLS – 2012;
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Semiconductor Industry Impact on the U.S. Economy
(2013)
Total Domestic Exports: $ 26.66 billion
Total Manufacturer Employment*: 244,800
Balance of Trade Deficit**: $-12.78 billion
% of U.S. Production Exported***: 53%
* Semiconductor Industry Association** Negative due to overseas packaging in Costa Rica, Malaysia, Taiwan, China (top 4 importers) *** 2011, based on total exports
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U.S. Industry Leadership
2013 Top 20 Semiconductor Sales Leaders Forecast ($M, Including Foundries)
2013F Rank
2012 Rank
Company
Headquarters
2012 Tot Semi
1Q13 Tot Semi
2Q13 Tot Semi
3Q13 Tot Semi
4Q13F Tot Semi
2013F Tot Semi
2013F/2012 % Change
1 2 3 4 5
1 2 3 4 8
Intel Samsung TSMC* Qualcomm** SK Hynix
U.S. South Korea
Taiwan U.S.
South Korea
49,114 32,251 16,951 13,177 9,057
11,555 7,946 4,460 3,916 2,577
11,785 7,769 5,152 4,222 3,521
12,366 8,805 5,377 4,457 3,692
12,615 9,070 4,815 4,550 3,250
48,321 33,590 19,804 17,145 13,040
-2% 4%
17% 30% 44%
6 7 8 9
10
6 5
10 9 11
Toshiba TI Micron ST Broadcom**
Japan U.S. U.S.
Europe U.S.
11,217 12,081 8,002 8,364 7,793
2,938 2,718 2,158 1,994 1,954
2,868 2,872 2,493 2,033 2,035
3,356 3,064 2,900 2,077 2,146
3,035 2,820 3,000 2,080 1,975
12,197 11,474 10,551 8,184 8,110
9% -5% 32% -2% 4%
11 12 13 14 15
7 14 13 12 15
Renesas Infineon AMD** Sony NXP
Japan Europe
U.S. Japan
Europe
9,314 4,928 5,422 5,709 4,325
1,886 1,208 1,088 1,247 1,085
1,920 1,327 1,161 1,144 1,188
2,101 1,390 1,461 1,203 1,249
1,920 1,340 1,534 1,295 1,265
7,827 5,265 5,244 4,889 4,787
-16% 7% -3%
-14% 11%
16 17 18 19 20
22 17 19 20 18
MediaTek** GlobalFoundries* Freescale UMC* Nvidia**
Taiwan U.S. U.S.
Taiwan U.S.
3,366 4,013 3,803 3,730 3,965
817 946 925 898 939
1,115 1,020 987
1,016 903
1,308 1,125 1,030 1,060 1,005
1,275 1,170 1,000 945 905
4,515 4,261 3,942 3,919 3,752
34% 6% 4% 5% -5%
Top 20 Total 216,582 53,255 56,531 61,172 59,859 230,817 7% *Foundry **Fabless
Source: IC Insights' Strategic Reviews Database
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Computer36.3%
Gov/Mil0.9%
Industrial6.2%Auto
7.6%Consumer
11.2%
Communications37.9%
Smartphones Surging –smartphone shipments have
overtaken PC shipments
2014F IC Market by Application ($287.18 B)Smartphones and Tablets Drive Convergence
PC/Computer usage shifting; -- consumers
purchasing tablets in record numbers
Source – IC Insights 2013
Flat Panel TVs dominate in
this end market
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World Semiconductor Market is Growing 2009 - 2015
2009 2010 2011 2012 2013 2014F 2015F0
50
100
150
200
250
300
350
$226.30
$298.30 $299.50 $291.60$305.60
$318.10$328.90
$ Bi
llion
s
F: ForecastSource: WSTS, SIA
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U.S. Semiconductor Exports 2009-2013
2009 2010 2011 2012 20130
5
10
15
20
25
30
35
$25.66
$32.29$30.14
$27.07 $26.66
$ Bi
llion
s
Domestic Exports: Excludes re-exports for semiconductor testing in the U.S.
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Top U.S. Semiconductor Export Markets 2013
China$3,625
Malaysia$3,242
Korea$3,128
Mexico$2,592Philippines
$1,963
Taiwan$1,592
Hong Kong$1,564
EU $1,530
Canada$1,303
Thailand$1,128
Costa Rica$962
Other$4,035
In $ Millions
Domestic Exports
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2013 Semiconductor End Markets
China* Americas Korea* Europe Japan Taiwan** 0
20
40
60
80
100
120
140
160
180
$153.07
$61.50
$34.92 $34.88 $34.80
$20.04
$ Bi
llion
s
* China, Korea 2012 data** Taiwan : Integrated Circuits (IC) only, 2012 data Source: WSTS Autumn Forecast 2013, Price Waterhouse Coopers (China), Invest Korea (Korea) , TSIA (Taiwan)
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FDI in the Semiconductor Industry $36.1 Billion in 2012
Global Foundry, Abu Dhabi
• $9 billion fab, outside of Albany, NY
Samsung, South Korea
• $13 billion fab, Austin Texas
FDI: BEAImage: Forbes
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Opportunities• Successful expansion of the WTO Information Technology
Agreement to cover new technologies
• Growing demand in China, India, and Latin America for smart phones, tablets, set top boxes, flat screen TVs, and other consumer electronic products; an increase in automobile electronics; and investment in broadband and mobile networks is driving demand for semiconductors.
• Growing demand for cloud services is increasing demand for servers
Semiconductor Manufacturing Equipment
Semiconductor Manufacturing Machinery (NAICS 333242*) Semiconductor Test Instrumentation (Part of NAICS
334515**) Flat Panel Display Manufacturing Equipment (Part of NAICS
333249)
* Formerly NAICS 333295** NAICS 334515: Instruments and Apparatus for Measuring and Testing*** NAICS 333249: Other Industrial Manufacturing Machinery
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Mm
Semiconductor Manufacturing Equipment Categories:
Semiconductor Wafer Fabrication
Equipment• Lithography• Metallization• Chemical
Deposition• Etc.
Test and Inspection Equipment
Packaging/Final Assembly Equipment
Mask/Reticle Manufacturing
Equipment
Silicon Boule/Bare Wafer Manufacturing
Equipment
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World Semiconductor Manufacturing Equipment Market Growing 2014-2015
2009 2010 2011 2012 2013 2014F 2015F0
5
10
15
20
25
30
35
40
45
50
$15.92
$39.92$43.53
$36.93
$31.58
$39.46 $40.40
$ Bi
llion
s
25%
F: ForecastSource: SEMI
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2014 Semiconductor Equipment End Markets
Taiwan Korea U.S. Japan Europe China Other0
2
4
6
8
10
12
$10.39
$7.80 $7.60
$4.11 $4.08
$3.05
$1.90
World Market $39.46 Billion
$ Bi
llion
s
Source: SEMI December 2013 Projection. U.S. is North America
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Semiconductor Manufacturing Equipment Impact on the U.S. Economy
(2013)
Total Domestic Exports: $ 9.89 billion
Total Manufacturer Employment*: 16,568
Balance of Trade Surplus: $3.5 billion
% of U.S. Production Exported**: 74%
* 2011**Production: U.S. Company Production, Source: SEMI
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US Companies: 42% Share of World Semiconductor Equipment Sales
Japan9.99332%
EU*6.3220%
Other1.968
6%
US13.299
42%
In $ Billions
*Estimate. Source: SEMI, SEAJ (Japan), Electronic Leader’s Group (EU); 2013 data
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U.S. Companies: Top Equipment Suppliers
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Top U.S. Semiconductor Equipment Export Markets 2013
Taiwan324533%
Korea195720%
EU130213%
China124213%
Japan96910%
Singapore7327%
Other4374%
In $ Millions
Domestic Exports
Opportunities (1) U.S. Companies represent 42% of the World Market
Upturn of Sale Cycle Expected for 2014 and 2015.Growing Demand for Semiconductors and greater
density/narrow line widths lead to more Semiconductor Manufacturing Equipment Sales
Semiconductor Equipment Sales lead to Services and Parts Sales
Illustrations: Global foundries For US Government Use Only 41
Opportunities (2)For the Semiconductor Equipment industry, a successful WTO Information Technology Agreement (WTO ITA) Expansion will:
Ensure Duty Free treatment of all types of semiconductor manufacturing equipment.
Eliminate tariff on certain semiconductor manufacturing accessories and fab floor equipment, including: FOSB (Front Opening Shipping Box) for wafer
handling/protection
Photomask
Gas/Chemical Purification Equipment FOSB picture: Entegris For US Government Use Only 42
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Certified Trade Show for Semiconductor Manufacturing Equipment and Materials
Japanese semiconductor equipment market forecasted to grow in 2015
Japan is the 3rd largest world market (excluding the U.S.) but the 5th largest export market for the U.S.
Difficult market for lesser known U.S. companies to penetrate due to strong Japanese company competition
U.S. SMEs can make connections with Japanese semiconductor companies through the Show
http://www.semiconjapan.org/en/
• Government/Authorities Meeting on Semiconductors (GAMS): USTR, Industry (World Semiconductor Council). U.S., Japan, South Korea, EU, Chinese Taipei (Taiwan), China
Governments and Industries
• IPR: USTR, US Patent and Trademarks (USPTO), Customs and Border Patrol, Other ITA (JCCT)
• Information Technology Agreement Expansion: USTR, Customs and Border Protection, State Department, Other ITA; Industry
• Work with ITA/GM to promote U.S. exports at semiconductor manufacturing industry trade show Semicon Japan, December 2014
Examples of ITA and Interagency Activities
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Information Technologies Team Staff
Linda Astor; Acting Team [email protected]; 202-482-4523
Cary Ingram; Communications, Network, and Transmission Equipment [email protected]; 202-482-2872
Indrek Grabbi; [email protected]; 202-482-2846
Dorothea Blouin; Semiconductor manufacturing equipment, WTO ITA, [email protected]; (202) 482-1333
http://trade.gov/td/OHIT
Robin Gaines; Computer equipment [email protected]; (202) 482-3013
Sergio Delgado; Computer [email protected]; (202) 482-3548