TSMC and Samsung in Talks with UAE for Groundbreaking Chip Megafactories: Boosting Semiconductor Production in the Middle East

Chip Megafactories

TSMC and Samsung in Talks with UAE for Groundbreaking Chip Megafactories

Global semiconductor leaders Taiwan Semiconductor Manufacturing Co. (TSMC) and Samsung Electronics are in preliminary discussions with the United Arab Emirates (UAE) about establishing large-scale chip manufacturing facilities in the region, according to a recent report by the Wall Street Journal.

The potential megafactories would primarily receive funding from the UAE, with the Abu Dhabi sovereign wealth fund, Mubadala, playing a pivotal role in financing the expansion of the nation's semiconductor sector.

Recently, TSMC executives visited the UAE to explore building factories that would rival their most advanced operations in Taiwan. Similarly, senior leaders from Samsung have been assessing investment opportunities for chip production facilities in the UAE.

The UAE has been actively investing in its tech sector as part of its strategy to become a global hub for advanced technology and artificial intelligence. However, the negotiations with UAE officials are still in the early stages.

Tensions between the U.S. and China are also influencing these discussions, as Washington is increasingly concerned about China's growing presence in the Gulf. Both TSMC and Samsung have consulted with U.S. officials, who are apprehensive about the potential for advanced AI chips produced in the UAE to be shipped to China.

Experts predict that the U.S. will continue to exert pressure on the UAE to limit collaboration with China, particularly in the semiconductor domain, given the implications for national security.