PEZA approves P537-M project

The Philippine Economic Zone Authority (PEZA) has approved the registration of Cypress Semiconductor Philippines Inc.'s (CPSI) P537.4-million project at the Gateway Business Park-Special Economic Zone (GBP-SEZ).

PEZA Director General Lilia de Lima said CPSI had applied for pioneer status for the new project which would involve the manufacture of an electronic component used in memory devices and computer clocks.

As a pioneering activity, Cypress' new project will be entitled to various incentives including a preferential tax rate of three percent on gross sales instead of the usual 35 percent paid by corporations.

The company will also be able to import duty-free machines and equipment it needs for the project.

Cypress is 99.98-percent owned by the US-based Cypress Semiconductor Corp. (CSC) and has been operating at the GBP-SEZ where it has a P1.56-billion plant.

According to De Lima, CSPI will manufacture fine pitch/flexible ball grid array (FBGA) in a new facility to be constructed within its existing plant area.

The FBGA, according to CSPI's application, is used primarily in consumer oriented electronic products mainly for slow random access memory (SRAMs) devices and clocks.

SRAMs are used in cellphones and pagers while the clocks are used in computers. These clocks, according to CSPI, provide all the outputs necessary to control systems, bus peripheral components, servers, workstations, personal computers and laptops.

According to CSPI's proposal, the machinery and equipment to be used in the project will be imported from Singapore and the US. The raw materials, on the other hand, will be imported from Japan, Singapore and the US, including substrate, epoxy, molding compound, solder ball and gold wire.

CSPI said phase one of the project will be completed this month and the new plat is expected to be in commercial operation by June this year. By October, CSPI said it will have completed its shipment set up.

CSPI said the project, which will be financed by its parent company, is expected to generate $11.393 million in export sales and about $4.402 million in net foreign exchange earnings.