Texas Instruments (TI) plans to invest $1bn in the Philippines over the next ten years to expand its chip assembly operations there, it announced today.

TI will build a test and assembly plant at the Clark Freeport Zone, a former US Air Force base that has been converted to an industrial park. TI expects eventually to employ 3,000 workers at the plant, which will be its second such facility in the Philippines, adding to an existing plant in Baguio City.

Construction on TI's Clark Freeport plant is scheduled to start during the second half of 2007, with production due to commence during the last half of 2008. Once completed, the new plant will double TI's test and assembly capacity in the Philippines, the company said.

Test and assembly plants package the silicon dies inside a package that can be used inside a computer or other electronic device. Test and assembly is the final stage of chip manufacturing and is more labour-intensive than wafer fabrication, which requires massive capital outlays. The Philippines has attracted other chip manufacturers seeking to keep chip prices down by controlling the cost of this labour-intensive process: Intel also has a test and assembly plant there.