🧠 Food for thought

Implications, context, and why it matters.

Southeast Asia is already spending billions to move beyond chip packaging

• Southeast Asia is a global center for assembly, testing, and packaging, or ATP, the later stage of chip production after wafers are made 1.
• Intel plans to spend US$7 billion in Malaysia to expand assembly, testing, and packaging in Penang and Kulim, while Infineon has committed US$5 billion for a second phase of front-end manufacturing in Singapore 1.
• Governments are backing that push with workforce plans. Malaysia aims to upskill 60,000 engineers, and Vietnam is targeting 50,000 by 2030 1.
• Singapore is revisiting incentives to attract Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract chipmaker, to make advanced chips in the country 2.

New chip fabs take years and enormous sums

• Calls for more fabrication plants often skip the cost. One cutting-edge fab can cost tens of billions of dollars and take at least five to seven years to build 3.
• Even with government backing, timelines slip. Intel’s Ohio plant moved from a 2025 production target to about 2030 for the first plant, and TSMC’s second Arizona fab was pushed to 2027 34.
• Competition is intense, with subsidies playing a big role. Japanese taxpayer support for TSMC is set to top 1 trillion yen, or US$6.7 billion, as it builds two fabs in Japan 4.
• Since 2020, companies across the chip industry have announced more than US$645.3 billion in private U.S. investments, which raises the bar for any country trying to enter the supply chain 5.