Taiwan President Lai Ching-te has called for an economic partnership agreement with the European Union, emphasising the need for collaboration in semiconductors and shared democratic values. Speaking at a Taiwan-EU investment forum in Taipei, Lai highlighted the importance of secure supply chains and stronger ties to counter growing authoritarian threats.
The EU, under its European Chips Act, has sought to deepen cooperation with Taiwan to boost semiconductor production and reduce reliance on Asia. Taiwan Semiconductor Manufacturing Co.’s (TSMC) new chip plant in Dresden, Germany, underscores Taiwan’s role in strengthening European industry and supply chains.
While Maria Martin-Prat of the European Commission praised Taiwan as a trusted economic partner in her video address to the forum, she did not mention plans for a formal agreement. Taiwan, diplomatically isolated from most global organisations, has been pursuing trade deals with like-minded partners, recently securing an Enhanced Trade Partnership with Britain and seeking membership in the CPTPP.
The United Kingdom is sending its first trade delegation focused on AI and semiconductors to Kolkata on 18-19 November 2024. Seventeen leading British organisations specialising in technological innovation will take part in the two-day mission.
A key goal is to explore business opportunities in West Bengal and eastern India, fostering partnerships between British companies and Indian stakeholders. The initiative is aimed at bolstering collaboration in AI and semiconductor research, development, and manufacturing, addressing the growing demand in these sectors.
Andrew Fleming, the British Deputy High Commissioner to East and North-East India, expressed enthusiasm for the initiative, highlighting the potential for new partnerships. He emphasised the strengthening ties between the UK and India in the technology sphere, particularly in East and Northeast India, as key drivers for this mission.
Activities during the visit include roundtable discussions, networking events, and Business-to-Business meetings. Organised by the British Deputy High Commission in Kolkata in partnership with NASSCOM and Asterix Innovations, the engagements aim to identify opportunities for collaboration, innovation, and investment, paving the way for expanded cooperation between the UK and India.
Amazon Web Services (AWS) is offering $110 million in free computing power to researchers to promote its custom AI chips. The programme provides credits for the use of AWS’s Trainium chips, which are designed to compete with Nvidia’s widely-used hardware, as well as Advanced Micro Devices and Alphabet’s cloud technology. Researchers from Carnegie Mellon University and the University of California, Berkeley, are already participating, with AWS planning to make 40,000 Trainium chips available.
AWS, the world’s leading cloud provider by sales, is facing intensified competition from Microsoft, especially as the demand for cutting-edge AI hardware grows. The company is taking a novel approach to lure AI developers by offering detailed documentation for Trainium’s instruction set architecture. This will allow researchers to program the chip directly, unlike Nvidia‘s chips, which usually require the use of proprietary Cuda software.
Gadi Hutt, head of business development for AI chips at AWS, said this strategy is aimed at customers with large-scale operations. Even minor programming adjustments could yield significant performance and cost advantages when using tens of thousands of chips. Hutt emphasised that companies investing hundreds of millions in computing infrastructure would welcome opportunities to improve efficiency and reduce expenses.
The US Commerce Department has pledged up to $18.2 million in funding to California-based Akash Systems to build a 40,000-square-foot cleanroom facility dedicated to advanced semiconductor manufacturing in West Oakland, California. This funding, part of the $52.7 billion semiconductor subsidy program, will be combined with Akash’s own investments and venture capital to create a $121 million production site for Diamond Cooling substrates and systems designed to enhance thermal management in AI-driven data centres.
Akash CEO Felix Ejeckam highlighted this investment as a significant step in meeting the challenges of high-performance computing. Last year, the company also established a landmark labor neutrality agreement for West Oakland semiconductor production workers in partnership with the IUE-CWA union, covering both construction and production roles.
The announcement comes as the Commerce Department works to finalise semiconductor grants under the 2022 Chips and Science Act, aimed at bolstering US-based chip production to reduce reliance on Asia. Thus far, around 20 companies have been awarded 36 billion in preliminary agreements, including a finalised $123 million deal with Polar Semiconductor to modernise its facility in Minnesota. Additional awards for major chipmakers, including Taiwan Semiconductor Manufacturing Co. and GlobalFoundries, are expected before the administration transition in January.
China’s Taiwan Affairs Office has criticised a recent US decision to halt Taiwan Semiconductor Manufacturing Co. (TSMC) from shipping advanced chips to certain Chinese customers. The office’s spokeswoman, Zhu Fenglian, stated that the US is ‘playing the Taiwan card’ to heighten tensions in the Taiwan Straits and that the move negatively impacts Taiwanese businesses. This statement follows reports that TSMC stopped these shipments on Monday after an order from US authorities.
The restricted chips, widely used in AI technology, are part of ongoing US efforts to tighten export controls amid rising bipartisan concerns over Chinese access to advanced tech. The restrictions follow a recent notification by TSMC to the US Commerce Department, revealing that one of its chips was used in a Huawei AI processor. Huawei, a central figure in US-China tech tensions, has been under trade restrictions, requiring suppliers to secure licenses for any technology exports.
South Korea’s ruling party has proposed a new chips act designed to offer subsidies to chipmakers and provide an exemption from the national cap on working hours. The legislation comes as the country faces increased competition from rivals in China, Taiwan, and other nations, along with potential risks from measures threatened by incoming United States President Donald Trump. The semiconductor sector is crucial for South Korea‘s economy, accounting for 16% of total exports last year.
President Yoon Suk Yeol recently warned of challenges posed by Trump’s threat of steep tariffs on Chinese imports, which could lead Chinese rivals to cut export prices and impact South Korean chip firms abroad. The bill, which requires approval from the main opposition party, also includes provisions allowing extended working hours for some research and development employees. However, Samsung’s labour union has opposed this, arguing that the company is deflecting blame for its financial struggles.
Samsung has apologised for disappointing profits as it lags behind competitors like TSMC and SK Hynix in the AI chip market. Global competition has intensified as countries like China, Japan, and the United States have been subsidising their chip manufacturers. In a recent statement, lawmaker Lee Chul-gyu stressed that the proposed act would help South Korean companies remain competitive amid the ongoing semiconductor trade tensions between the United States and China.
Japan’s government will not impose any tax increases to finance its ambitious 10 trillion yen ($65 billion) plan aimed at bolstering the country’s semiconductor and AI sectors, Industry Minister Yoji Muto announced on Tuesday. The statement followed Prime Minister Shigeru Ishiba’s unveiling of the substantial aid package to strengthen Japan‘s technology industry.
Prime Minister Ishiba clarified that deficit-covering bonds would not be issued to fund the initiative. The government’s approach to supporting high-tech projects is intended to enhance Japan’s global competitiveness without burdening taxpayers or adding to the national debt.
The funding strategy underscores Japan’s commitment to advancing domestic technology sectors while maintaining fiscal responsibility. The measures reflect a broader effort to secure the nation’s position in critical technology fields, vital for economic growth and national security.
Japan is set to send 200 engineers and students to the United States over the next five years as part of an ambitious effort to revitalise its semiconductor industry. The trainees will join US-based chip venture Tenstorrent to specialise in the design of chips for AI, according to the Leading-edge Semiconductor Technology Center. This research organisation was established in 2022 to spearhead advanced chip development.
The program aims to restore Japan’s standing in the semiconductor market, which has waned in recent decades with the rise of competitors like South Korea and Taiwan. Training periods will last up to 18 months and are intended to develop the technical expertise needed to produce state-of-the-art semiconductors.
Supported by government funding of 7.5B yen (approximately $49M) over five years, the initiative is part of a state-backed project led by the New Energy and Industrial Technology Development Organization. Key collaborators include Japanese tech giant SoftBank Corp and the University of Tokyo, with applications opening by March next year. This strategic move underscores Japan’s commitment to reclaiming a leading role in global chip production as demand for advanced technologies continues to surge.
The CEOs of Europe’s top three chip manufacturers expressed concerns about the rising nationalist policies from the US, China, and Europe. They argue these policies are pushing each region to secure its own semiconductor supply, causing significant strain on the global chip industry.
Infineon, STMicroelectronics, and NXP—major suppliers of chips for electric vehicles and industrial technology—highlighted the challenges these policies are creating. Speaking at an electronics conference in Munich, Infineon’s CEO Jochen Hanebeck warned that further fragmentation is likely, particularly through tariffs, which could seriously disrupt global supply chains.
STMicroelectronics’ Jean-Marc Chery pointed out that duplicating supply chains across continents has led to costly investments in both materials and engineering. The pressure to maintain regional independence in chip production is placing an unsustainable burden on resources, he noted, particularly as China’s demand for chips in electric vehicles remains strong.
Kurt Sievers, CEO of NXP Semiconductors, argued that no country could feasibly achieve self-sufficiency in the chip industry. Attempting to do so, he said, would lead to prohibitive costs, making electronic devices unaffordable for consumers. He anticipates governments will eventually realise that global cooperation is essential for sustaining the semiconductor industry.
Vietnam’s semiconductor industry is gaining momentum as foreign companies invest in chip testing and packaging facilities, shifting some production away from China. Amid trade tensions between the US and China, several global players, including South Korea’s Hana Micron and US-based Amkor Technology, are expanding operations in Vietnam to diversify their production bases. Hana Micron has committed over $930 million to boost its packaging capacity, while Amkor is investing $1.6 billion to establish its largest packaging plant, transferring some machinery from its Chinese facilities.
The rise in investment is set to increase Vietnam’s global share in chip assembling, testing, and packaging, with estimates suggesting a rise from 1% in 2022 to around 8-9% by 2032. Domestic companies are also stepping up. Vietnamese tech firm FPT plans to start a testing facility near Hanoi next year, investing up to $30 million, while Sovico Group is seeking partnerships for a chip plant in Danang.
Vietnam’s strategic push into the semiconductor sector has been encouraged by the US, viewing the country as a potential alternative to China for supply chains. The Biden administration’s support, especially as trade tensions grow, has bolstered Vietnam’s role in this industry. With domestic and foreign investments combined, Vietnam is poised to strengthen its position as a key player in the global semiconductor back-end market.
Looking forward, Vietnam is ambitiously aiming to develop its front-end chipmaking capabilities, planning to have its first foundry operational by 2030. Viettel, a state-owned firm, is set to lead this initiative, indicating Vietnam’s broader goal of advancing its semiconductor industry and reducing reliance on foreign production bases.
