Taiwan raising $4 billion to build industrial park in Texas to support US chipmaking supply chain

Taiwan is raising at least $4 billion through the Taiwan Electrical and Electronic Manufacturers’ Association to build an industrial park in Texas. According to Bloomberg, the site is designed to support the countless smaller manufacturers that major manufacturers like TSMC and Foxconn rely on.

“We are going to establish a long-term, sustainable supply chain there that can also be joined by American firms and local workers, and not just Taiwanese companies,” Taiwan Minister of Economic Affairs Kung Ming-hsin said.

Major Taiwanese companies are more than capable of spending the billions of dollars needed to set up shop in the U.S. TSMC, for example, has already spent $165 billion to put up its Arizona site, and has committed a further $100 billion to build four more 2nm fabs. However, they also rely on several smaller manufacturers that do not have the financial capability to expand operations into the U.S. independently. Nvidia CEO Jensen Huang has even recognized some of these companies in a keynote in Taipei earlier this year, nothing the crucial part that these smaller companies play in the global AI supply chain.

Support for these businesses will not be limited to the planned industrial park, too. The Taiwanese government said that it will also offer loan guarantees to the companies that want to operate on the land, plus support them in communicating with local and federal U.S. officials regarding visas, permits, and other documentation.

Taiwan has reportedly secured a piece of land in Texas specifically for this project, but the Ministry of Economic Affairs didn’t give out any details yet, saying that it will elaborate on the project later. It’s also not limiting itself to a single industrial park, with the government saying that it’s planning for “more than one” site that would cost between $2 billion and $4 billion.

While the U.S. government hasn’t commented on Taiwan’s industrial park plan, the planned $4-billion investment would follow the “Taiwan model” that would help its companies invest in America easily and shorten the AI semiconductor supply chain that relies on Taiwanese industry. But even though these companies are primarily focused on meeting the needs of Taiwanese giants like TSMC, Foxconn, and Wistron, American companies are also welcome to work with them. Kung even said that Elon Musk’s Terafab can take advantage of this prospective supply chain, although he also said that they will not transfer their technologies so that he could integrate them vertically.

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