We recently conducted an in-depth study on the semiconductor industry’s funding, focusing on both government and private sector investments over the last five years.
Our goal was to identify which countries are leading the charge in this critical sector. The results paint a fascinating picture of the global semiconductor landscape and reveal some surprising trends.
Key Findings:
- The United States is currently leading with $692.7 billion in funding over the past five years.
- Europe’s top 10 leading countries in the semiconductor race amount to $338.7 billion, which is dwarfed in comparison to the US’s $692.7 billion.
- South Korea plans to build the “world’s largest” chip center with a $470 billion investment, signaling aggressive expansion in semiconductor manufacturing.
- In 2023, Chinese companies purchased over $40 billion worth of chip-making equipment, which is the second-largest value on record since 2015.
- Taiwan’s semiconductor sector accounted for $115 billion, around 20% of the global semiconductor industry in 2021.
Global Investment Overview
Our research has compiled a comprehensive overview of semiconductor investments across major countries and regions. The following table provides a detailed breakdown of these investments:
| Country | Cumulative Funding (2019~2024) |
Government Funding | Private Sector Funding |
|---|---|---|---|
| United States | $692.7 B️ | $52.7 B️ | $640 B️ |
| South Korea | $477.3 B️ | 7.3 B️ | $470 B️ |
| China | $338.3 B️ | 47.5 B️ | $290.8 B️ |
| Taiwan | $101.52 B️ | 1.52 B️ | $100 B*️ |
| Germany | $71.6 B️ | 22 B️ | $49.6 B️ |
| Ireland | $45.94 B️ | -️ | $45.94 B️ |
| Switzerland | $40.93 B️ | $37.81 B️ | $3.12 B️ |
| Sweden | $38.86 B️ | $57.7 B️ | $38.8 B️ |
| India | $26.1 B️ | $15.2 B️ | $10.9 B️ |
| Japan | $24.8 B️ | $24.8 B️ | -️ |
| UAE | $22.4 B️ | $22.4 B️ | -️ |
| Italy | $14.12 B️ | $10.7 B️ | $3.42 B️ |
| France | $13.58 B️ | $5.43 B️ | $8.15 B️ |
| The Netherlands | $12.75 B️ | $250 M️ | $12.5 B️ |
| Malaysia | $5.3 B️ | $5.3 B️ | -️ |
| Russia | $5 B️ | $5 B️ | -️ |
| Poland | $4.6 B️ | -️ | $4.6 B |
| Singapore | $4.17 B️ | $144.9 M | $4.02 B |
| Czech Republic | $2 B️ | $550 M | $1.45 B |
| Australia | $1.64 B️ | $1.5 B | $140 M |
| United Kingdom | $1.2 B️ | $1.2 B | - |
| Norway | $952.5 M️ | $342 M | $610.5 M |
| Canada | $240 M️ | $240 M | - |
The United States: Still in the Lead, But for How Long?
Our research shows that the United States is currently at the forefront of semiconductor investments, with a staggering $692.7 billion in funding over the past five years.
This includes:
- $52.7 billion from the CHIPS and Science Act
- $39 billion in subsidies for semiconductor production
- $11 billion for research and development
- A 25% investment tax credit for building chip plants, estimated at $24 billion
Asia: The Rising Giants
South Korea's Ambitious Plans
South Korea is making waves with its plan to build the “world’s largest” chip center. Key points include:
- A massive $470 billion investment by 2047
- Creation of a mega-cluster from Pyeongtaek to Yongin
- Projected production of 7.7 million wafers per month by 2030
Taiwan: The Semiconductor Powerhouse
Taiwan continues to be a dominant force in the semiconductor industry:
- 13-15% of Taiwan’s GDP comes from semiconductors
- Industry output nearly doubled from $87.0 billion in 2018 to $162.5 billion in 2022
- Government investments include:
- $1 billion in ASML for R&D
- $260 million for 8-inch wafer process equipment
- $260 million for quantum computing development
- TSMC plans to invest $100 billion over three years to grow capacity
China's Strategic Push
China is making significant strides in the semiconductor sector:
- $47.5 billion invested through the “Big Fund III”
- Chinese companies purchased over $40 billion worth of chip-making equipment in 2023
India's Emerging Presence
India is also joining the race with substantial investments:
- $15.2 billion approved for semiconductor and electronics production
- Plans for the country’s first state-of-the-art semiconductor fab and two packaging and test facilities
Europe: A Collective Effort
While Europe’s investments may seem smaller compared to the US and Asian giants, several countries are making significant contributions:
Germany
Private sector investments in Germany include:
- TSMC: $10.8 billion for a chip production facility in Dresden
- Intel: $32.6 billion for chip-making plants in Magdeburg
- Bosch: $1 billion for a production facility in Dresden
- Infineon: $2.2 billion for expanding its Dresden site
- Wolfspeed: $3 billion for a silicon carbide semiconductor factory in Ensdorf
France
The French private sector has invested €7.5 B ($8.15 B) in a joint project by STMicroelectronics and GlobalFoundries to build a new factory in Crolles, France.
Italy
Italy is set to invest approximately €10 billion ($10.7 billion) in its semiconductor industry this year.
This follows Singaporean chipmaker Silicon Box’s €3.2 billion commitment to build a manufacturing facility in Italy. The increased investment could significantly bolster European supply chain resilience, foster new industry partnerships, and potentially shift the competitive landscape within the European electronics sector.
The Netherlands
The Dutch government has invested:
- €230 million ($250 million) in research projects
- Plans to invest $100 million in innovative chipmaking technology at Smart Photonics
Czech Republic
The Czech Republic is expanding its semiconductor capabilities with:
- $2 billion investment in ONsemi’s production facility
- Establishment of a cutting-edge chip research center in Brno through Taiwanese collaboration.
Poland
Poland is attracting significant investments:
- Intel’s €4.6 billion investment in a chip assembly and testing facility near Wrocław which will create 2,000 jobs and is part of its broader €33 billion European expansion plan.
- Additional investments from Taiwan’s USI, MediaTek, and various Japanese and South Korean companies
Conclusion: A Global Race with High Stakes
Our research shows that the semiconductor industry is experiencing unprecedented levels of investment worldwide. While the United States currently leads in total funding, countries like South Korea, Taiwan, and China are rapidly closing the gap with ambitious plans and substantial investments.
The global push in semiconductor technology is likely to lead to increased competition and faster technological advancements. As demand for semiconductors continues to grow, driven by advancements in AI, IoT, and electric vehicles, countries are positioning themselves not just as consumers but as key players in production and innovation.
Sources:
Reuters
The Economic Times
CNN Business
- https://edition.cnn.com/2023/03/15/tech/korea-chips-investment-hnk-intl/index.html#:~:text=check%20back%20later.-,South%20Korea%20to%20build%20’world’s%20largest’%20chip%20center%20with,%24230%20billion%20investment%20from%20Samsung&text=On%20GPS%3A%20Can%20China%20afford%20to%20attack%20Taiwan%3F&text=South%20Korea%20says%20it%20will,memory%20chip%20giant%20Samsung%20Electronics.
- https://edition.cnn.com/2024/05/27/tech/china-semiconductor-investment-fund-intl-hnk/index.html
Fortune.com
Innovation Origins
Invest Taiwan
New York Center For Foreign Policy Affairs
IEEE
Astute
Bloomberg
Government of Canada
Clean Energy Wire
CNBC
Digitimes
- https://www.digitimes.com/news/a20230627VL205/china-ic-manufacturing-semiconductor-chips+components.html
- https://www.digitimes.com/news/a20230727VL203/intel-poland-tsmc-usi.html
ThinkChina
Tom’s Hardware
The White House
