Despite the Biden government’s call for the closure of domestic semiconductor manufacturing. GlobalFoundries Inc will build a US$4 billion (RM16.4 billion) chip factory in Singapore in 2023. With the goal of Asia as the location for its recent expansion.

The US-based company has joined rivals such as TSMC and Samsung Electronics. As they are expanding their production capacity to solve the continuing chip shortage in everything from cars to smartphones. US$30 billion (RM123 billion)-They are said to be focused on Singapore. But will also spend US$1 billion to establish offices in Dresden, Germany, and the United States as government partners.

GlobalFoundries and its partners Micron Technology Inc and Infineon Technologies AG are major investors in Singapore. The company previously promised to expand production in this city-state as well as in Europe and the United States. Chip-making facilities start producing chips 18 months to two years after the failure. After completion, GlobalFoundries’ Singapore factory will mainly meet the demand for smartphones and automobiles.

Singapore has been committed to expanding the talent pool in the semiconductor industry, which has long sought foreign investment. The chip industry is considered a vital electronics company. Which accounts for approximately 7% of the economy. In the first four months of this year, due to increased demand after the pandemic, the output of electronic products increased by 21.7% year on year. Singapore’s current goal is to grow its manufacturing industry by 50% in the next 10 years to remain competitive.

On Tuesday Chip manufacturer GlobalFoundries announced that it will spend $6 billion. To expand the manufacturing capacity of its factories in Singapore, Germany and the United States, while global automakers and electronics companies are suffering from chip shortages.

The American company, which is owned by the Abu Dhabi state-owned Mubadala Fund, said it will invest more than US$4 billion in Singapore in the next two years. Each with an investment of US$1 billion. The chip shortage began in late December, partly because automakers misjudged semiconductor demand during the pandemic. And it was exacerbated by the fact that work at home stimulated the sales of computers and other gadgets and electronics manufacturers ordered more chips.

Major chip makers, including Intel, have warned that the shortage will continue into next year. In March, Intel announced a US$20 billion plan to expand its advanced chip manufacturing capabilities. While Taiwan’s TSMC announced in April that it would invest US$100 billion in the next three years. In addition, governments including the United States and Japan have also intervened to demand faster delivery. Earlier this month, the United States approved $54 billion in funding to promote the manufacturing and research of semiconductors and telecommunications equipment in the United States.

The CEO stated that the US$4 billion investment in Singapore is the first of the company’s plans to expand gradually over the next 5 to 10 years. But did not give the total amount. The new plant in Singapore will increase its production capacity to 450,000 wafers per year. Bringing the total campus space to 1.5 million people, and the company expects to start production in early 2023. Most of the cumulative production will be put into operation by the end of 2023. The plant will produce automotive chips and 5G technology under long-term contracts. The client has been installed. This will create approximately 1,000 jobs in Singapore.