Taiwan invests big to create semiconductor hub

Funds to subsidize foreign investment in nation’s semiconductor industry

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(Pixabay photo)

(Pixabay photo)

TAIPEI (Taiwan News) — Taiwan has earmarked NT$7.6 billion (US$260 million) in subsidies for the development of the country’s semiconductor industry that will boost its strategic status as “a high-end product base in Asia” and “an advanced semiconductor fabrication center,” according to the Industrial Development Bureau at a press conference.

The funds will be used to lure foreign investment, with the objective being NT$1.2 trillion in investment from the private sector over the next decade. Japan’s Mitsubishi Chemical Holdings and Shin-Etsu Chemical Co., as well as German’s Merck Group, have revealed plans to establish research and development facilities in Taiwan on a scale totaling NT$9 billion within three years, reported CNA.

Taiwan’s semiconductor sector had an NT$2.7 trillion production value in 2019, and is expected to reach NT$5 trillion by 2030, according to a Ministry of Economic Affairs forecast.

Technologies such as Internet of Things (IoT), artificial intelligence (AI), and 5G will be incorporated to promote an industrial upgrade and smart manufacturing. There will be a priority on strengthening Taiwan’s ability to produce key materials on its own and localizing the advanced packaging process for semiconductor products, wrote TechNews.

Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest semiconductor foundry, has echoed the government’s push to localize supply chains. The company seeks to increase its procurement of raw materials from domestic suppliers to 64 percent by 2030, 40 percent for backend equipment, and 60 percent for components.