China approves $2.5b Intel plant

Semiconductor maker Intel has received approval to build a $2.5 billion chip plant in China amid booming Chinese demand for chips used in PCs and mobile phones, an Associated Press report said.

The Associated Press report, quoting the Web site of China's National Development and Reform Commission, the country's top economic planning agency, said the factory is planned for the northeastern city of Dalian.

The report said Intel, the world's largest semiconductor maker, has not revealed plans to build a chip plant in Dalian. Intel officials in Beijing and the chipmaker's headquarters declined to comment, saying the company has not made a formal announcement.

Demand for chips in China has soared as the country has risen to become the world's largest population of mobile phone users and as computer sales grow rapidly, the report said.

The communist government wants Chinese companies to spend more on developing profitable technology and is encouraging foreign companies to move high-tech facilities to China.