Dalian is in the Liaoning Province, the place where the magic is said to happen, or better still, where Intel will be building a new wafer fabrication facility (fab). They will be manufacturing 300mm wafers here, on the 90nm manufacturing process, with "initial plans" of building chipsets here. The 90nm manufacturing process is a long way from Intel's current manufacturing technology on 65nm, and the new processor line they are building on the 45nm manufacturing process.

The big concern is why is Intel building Fab 68, as it was called, which produces technology on a manufacturing process they introduced back in 2003. Both the U.S. and Taiwan governments have "export controls" that prevent "transferring any kind of advanced process technology to China". Their main problem is that China will use the 90nm Fab 68 for military purposes, using products built here in fighter jets, army missiles and so on.

It's also true that this plant will bring Intel an advantage on the Chinese market, because the technology China is currently using, the 180nm process node, which Intel first introduced in 1999. The official story is that this plant will build chipsets, but Intel is going to make the move for the 65nm process node on their chipsets as soon as they launch 45nm processors.

Paul Otellini, Intel's President and CEO said: "China is our fastest-growing major market and we believe it's critical that we invest in markets that will provide for future growth to better serve our customers. Fab 68 will be our first new wafer fab at a new site in 15 years. Intel has been involved in China for more than 22 years and over that time we've invested in excess of $1.3 billion in assembly test facilities and research and development. This new investment will bring our total to just under $4 billion, making Intel one of the largest foreign investors in China."