TSMC and Samsung Electronics are in Discussions with UAE to Build New Chip Megafactories in Coming Years, WSJ Reports

Two of the world’s largest chipmakers, global chip giants Taiwan Semiconductor Manufacturing Co. (TSMC) and Samsung Electronics, have talked about building major new megafactories in the United Arab Emirates in coming years which could be worth more than $100 billion to assist with fulfilling taking off demand for AI computing, the Wall Street Journal reported on Sunday.

Executives from TSMC, the world’s biggest chipmaker, have visited the UAE recently to discuss building a plant complex that could rival the organization’s advanced facilities in Taiwan, the newspaper said Sunday, refering to people acquainted with the communications.

Samsung Electronics, which is based in South Korea, has also thought about making an investment in the construction of chip manufacturing facilities in the nation in the coming years. Senior leaders in the South Korean organization have recently visited the country to analyze the concept, the report said.

South Korea-based Samsung Electronics, a producer of smartphones, televisions, and memory chips, is likewise considering major new chip-production operations in the country in the years ahead, the paper said.

The Gulf state has been sloping up efforts and investments in boosting its domestic tech industry as it works to construct its position as a global hub for advanced technology and AI. However, the report stated that the discussions with UAE officials are still in the early stages.

“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 on Monday, without elaborating.

Senior figures at Samsung Electronics visited UAE recently and talked about the idea, WSJ revealed, adding that the conversations were still in the beginning stages and may face technical and different obstacles.

Under the initial terms being discussed, the projects would be funded by the UAE, with a central role for Abu Dhabi-based sovereign development vehicle Mubadala, as indicated by WSJ.

The paper also stated that the broader goal would be to boost global chip production while simultaneously contributing to price reductions without compromising chip manufacturers’ profitability.

As tech deals in the region accelerate, Washington has become progressively worried about the UAE and other Middle Eastern countries becoming a channel for advanced U.S. AI technology reaching China.