Money for semiconductor investments has increased in Singapore over the past year, but the country still trails far behind Taiwan and other Asian chipmaking players.

According to Nikkei, Singapore has set a target for 2030 to increase its electronics manufacturing by 50%, with an eye on semiconductor development. In order to reach its target, foreign direct investment is expected to play a large role, per the report.

U.S. chipmaker GlobalFoundries announced in June that it would spend US$4 billion to expand capacity at its Singapore facility, while last December, German chipmaker Infineon Technologies announced it was investing US$20.2 million to develop artificial intelligence applications, Nikkei said.

Singapore hopes to further develop its semiconductor sector by improving chip design, wafer manufacturing, assembly and testing, research and development, and regional distribution, according to the report. The problem for Singapore is that the foundry market is dominated by Taiwan, South Korea, and China.

Taiwan alone accounts for nearly 64% of the world’s almost US$90 billion foundry market, research firm TrendForce told Nikkei. After Taiwan is South Korea at 18%, China at 6%, and other nations at 12%.

Taiwan Semiconductor Manufacturing Co (TSMC) controlled 55% of the global foundry market during the first quarter of this year, while Taiwan’s United Microelectronics Corporation accounted for 7%, TrendForce said.

Meanwhile, Singapore is responsible for around 5% of global wafer fabrication capacity, said Alvin Tan, minister of state at the Trade and Industry Ministry, Nikkei cited. Analysts told the outlet that Singapore will face increased competition as many governments are trying to push for more self-reliance in semiconductors.

One analyst said that despite efforts by South Korea, China, and Singapore, it will be difficult for any of the three to challenge Taiwan in the short term due to its established chipmaking ecosystem.

By: DocMemory
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