Chip Kingdom, Israel

The Israeli-Palestinian conflict is getting worse. As of October 14, 2023, the Palestinian health Ministry said that the current round of Israeli-Palestinian conflict has killed 1,949 Palestinians and injured more than 8,600. Israeli sources put the death toll at more than 1,300 and the number of wounded at least 3,484.

The impact of the conflict has spread to the chip supply chain, it is reported that Intel and Tower Semiconductor's fabs in Israel have begun to partially shut down, and the production and logistics operations of Israel's electronics supply chain have also been affected.

Israel, the "tiny country" located in the Middle East desert, is actually a "chip kingdom." In the local, there are nearly 200 chip companies, Broadcom, Qualcomm, Samsung and other giants are carrying out research and development activities in Israel, Intel and High Tower Semiconductor also have several fabs in Israel. In the first half of this year Intel announced a $25 billion spending spree on new plants.

What makes Israel the "chip kingdom"?

01

Israel is not a good place for semiconductors

The history of Israel's semiconductor is not early, but it has developed rapidly, and has become the world's leading semiconductor region in a short period of time.

In 1964, MOTOROLA set up its first semiconductor research and development center in Israel, marking the beginning of the semiconductor industry in Israel.

In 1974, Intel was persuaded by its Israeli employees to open its first research and development center outside the United States in Haifa, Israel. Since then, Israel's semiconductor industry has taken off.

In Israel, the world's first IBM PC 8088 processor based on Microsoft's operating system was born, Intel's first Pentium CPU, TI's Bluetooth chip and so on.

Decades later, today's Israeli semiconductors have become a force to be reckoned with. In a population of less than 10 million, there are more than 30,000 chip engineers and nearly 200 chip companies. Giants such as Apple, Broadcom, Qualcomm, Samsung, Huawei, Texas Instruments, LG, Hitachi, Marvell, KLA-Tencor and others are all conducting research and development activities in Israel.

One of the first companies to settle in, Intel, is now the largest "owner" in Israel.

At present, Intel has 4 research and development centers and 2 fabs in Israel

In 2022, Intel's exports in Israel amounted to $8.7 billion, accounting for 1.75% of Israel's GDP and 5.5% of its total high-tech exports. Some even said, Intel is Israel and Israel is Intel.

02

The start-up kingdom of semiconductors

No local giants

Israel is a small land area, desert, poor resources, is not a resource country, can not produce semiconductor materials. Subject to geographical conditions, Israel's semiconductor industry has unique characteristics: First, chip design; Second, most of them are small and medium-sized enterprises, without local giants; The third is to find ways between China and the United States and focus on business.

Chip design is the soul of Israel's semiconductor industry.

03

Plenty of talent and money

Prop up Israel Semiconductor

Israel's "innate conditions" are so poor, why can Israel develop into a chip kingdom?

The short answer is: rich and talented..

Israel has laws to encourage R&D and innovation, and to monitor where funds are spent and the results of projects. Give money generously, money can also be spent on the edge of the knife, do twice the result.

"Generous" government subsidies and a large venture capital industry make Israeli semiconductor companies "financially viable."

Besides money, talent is needed

According to the data of the Ministry of Commerce of our country, Israel's scientific research personnel account for 6% of the country's population, 135 scientists and engineers per 10,000 people, more than the United States 85 people, the proportion of the world's first. 77% of Israelis have more than 12 years of education, 20% of the population has a university degree, and there are nearly 200,000 college students in the country.

In addition to valuing the many native talents that education produces, Israel also receives a large number of highly educated immigrants.

Jewish immigrants from developed countries and the former Soviet Union brought a lot of science and technology to Israel, which played a large role in Israeli innovation. These immigrants generally have a high degree of education, there are many excellent engineers, these talents have played an indispensable role in the development of Israel's high-tech industry.

04

In General

The ancient region of Canaan, the fabled "Promised Land," and the real Israel, had almost "nothing."

In the Middle East, which is all over the desert, Israel, with innovation, capital and other strategies, has made up for its natural disadvantages and congenital shortcomings, and has become the focus of the world semiconductor industry in a short time. It is clear that the semiconductor "myth" of Israel is not the promise of God, but thousands of Moses and his descendants.