Key findings:
- The United States is currently leading with $692.7 billion in funding over the past five years.
- South Korea plans to build the “world’s largest” chip center with a $470 billion investment, signaling aggressive expansion in semiconductor manufacturing.
- In 2023, Chinese companies purchased over $40 billion worth of chip-making equipment, which is the second-largest value on record since 2015.
- Taiwan’s semiconductor sector accounted for $115 billion, around 20% of the global semiconductor industry in 2021.
- The Indian government has approved an investment of $15.2 billion for semiconductor and electronics production.
This pattern of ramping up investments reflects a global acknowledgment of the importance of the semiconductor industry, driven by its foundational role in modern technologies and national security.
As demand for semiconductors grows due to advancements in technologies like AI, IoT, and electric vehicles, countries are positioning themselves not just as consumers but also as key players in the production and innovation in the semiconductor space. This global push is likely to lead to increased competition and faster technological advancements.
United States:
The CHIPS and Science Act provides $52.7 billion, including $39 billion in subsidies for semiconductor production and $11 billion for research and development. It also creates a 25% investment tax credit for building chip plants, estimated to be worth $24 billion.
South Korea:
South Korea plans to open the world’s largest semiconductor manufacturing hub, with plans to invest a staggering $470 billion by 2047. This monumental investment aims to create a mega-cluster in the region stretching from Pyeongtaek to Yongin, which is anticipated to be capable of producing 7.7 million wafers each month by 2030.
Taiwan:
In recent years, the semiconductor industry accounted for 13–15% of Taiwan’s GDP. Between 2018 and 2022, the output of Taiwan’s semiconductor industry nearly doubled from $87.0 B to $162.5 B.
The Taiwanese government has invested:
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$1 B in ASML for R&D and manufacturing of 2-nanometer wafer optical measurement equipment.
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$260 M over five years to accelerate the development of key 8-inch wafer process equipment and pursue independent production of silicon carbide (SiC) powders.
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$260 M to establish a national quantum computer team and develop silicon-based quantum computing and quantum communications
The United States has committed up to $6.6 billion to Taiwan Semiconductor Manufacturing Corporation (TSMC) to expand production at its facilities in Arizona.
China:
The Chinese government has invested approximately $47.5 billion in its semiconductor manufacturing and production through the China Integrated Circuit Industry Investment Fund, also known as “Big Fund III.”
In 2023, Chinese companies purchased over $40 billion worth of chip-making equipment, which is the second-largest value on record since 2015.
Germany:
The biggest contributors in Germany’s private sector are:
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TSMC: $10.8 B for a chip production facility in Dresden.
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Intel: $32.6 B for chip-making plants in Magdeburg.
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Bosch: $1 B for a production facility in Dresden.
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Infineon: $2.2 B for expanding its Dresden site.
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Wolfspeed: $3 B for a silicon carbide semiconductor factory in Ensdorf.
India:
The Indian government has approved an investment of 1.26 trillion Indian rupees (approximately $15.2 billion) for semiconductor and electronics production, including the country’s first state-of-the-art semiconductor fab and two packaging and test facilities.
Japan:
Here are some key figures of the Japanese government’s investments in semiconductor manufacturing and production:
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TSMC’s Kumamoto Plant: The government contributed 40% of the cost for TSMC’s planned $8.6 billion manufacturing plant in Kumamoto, Japan.
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Kioxia and Western Digital’s Yokkaichi Plant: The government provided 92.9 billion yen in subsidies for the construction of a plant in Yokkaichi to produce 3D NAND Flash memory products.
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Rapidus’ Hokkaido Plant: The government supported Rapidus with 590 billion yen to construct a manufacturing facility in Hokkaido in partnership with IBM, with production expected to start in 2027.
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Total Government Investment: Between fiscal years 2021 and 2023, the Japanese government invested 3.9 trillion yen (approximately $24.8 billion) in the semiconductor sector.
France:
The French private sector has invested €7.5 B ($8.15 B) in semiconductor manufacturing and production, specifically in a joint project by STMicroelectronics and GlobalFoundries to build a new factory in Crolles, France.
The Netherlands:
The Dutch government has invested EUR 230 M ($250 M) in research projects in semiconductors and photonics as part of its Technology and Innovation Strategy. It also plans to invest $100 M in innovative chipmaking technology at the Eindhoven-based chip plant Smart Photonics.
Finland:
The Finnish government has not directly invested in semiconductor manufacturing and production facilities. The government’s semiconductor strategy, called “Chips from the North,” focuses on enabling growth through education, R&D, and attracting international talent and investments.
