NEW YORK – The United Arab Emirates (UAE) may develop $100 billion chipmaking facilities in coming years, as two of the world’s largest chipmakers are planning new projects in the Gulf State, the Wall Street Journal reported.
It is said that Taiwan’s Taiwan Semiconductor Manufacturing Company (TSMC) and South Korea’s Samsung Electronics have discussed building potential chipmaking projects, which could also attractive massive foreign direct investment.
ECONOMIC DIVERSIFICATION
The report comes as the UAE has been working on economic diversification so that the Gulf State could minimize reliance on oil. But it is not just the UAE as Saudi Arabia under Crown Prince Mohammed Salman’s Vision 2030 has also been striving for the same goal.
In fact, the two oil-rich nations are aiming at becoming global hubs for technology and manufacturing. Hence, they are also swiftly working on tourism and other related developments through comprehensive reforms to make themselves attractive for foreign investors.
Meanwhile, it also coincides with the ongoing efforts to ramp up global semiconductor production and drive down prices amid the US-China trade war.
However, the increasing number of tech deals has made these developments a double-edged sword. The reason is that Washington has become increasingly concerned about the UAE and other Middle Eastern countries becoming a conduit for advanced US AI technology reaching China.
SOURCE OF FUNDING
According to WSJ, top executives at TSMC have visited the UAE recently and talked about a plant complex on par with some of the company’s largest and most advanced facilities in Taiwan.
Similarly, Samsung Electronics, a maker of smartphones, TVs and memory chips, is also considering major new chip-making operations in the country.
However, TSMC says it has no new investment plans to announce.
“We are always open to constructive discussion on ways to promote development of the semiconductor industry, but we remain focused on our current global expansion projects and have no new investment plans to disclose at this time,” it said in a statement, without elaborating.
However, Samsung declined to comment on the WSJ report.
Under initial terms being discussed, the projects would be funded by the UAE, with a central role for Abu Dhabi-based sovereign development vehicle Mubadala, the WSJ said.
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