Relevant officials stated that to encourage Taiwan-based IC design houses, the MOEA has offered generous subsidies, aiming for over 40% of Taiwanese IC design houses to adopt advanced manufacturing processes.
Following Nvidia and Micron, which received substantial government subsidies to establish R&D centers in Taiwan, the Ministry of Economic Affairs (MOEA) successfully attracted ASML, Lam Research, and Synopsys in 2023. In 2024, investment projects by Infineon in April and AMD in July followed suit.
According to the MOEA's announcement, AMD will establish R&D centers in both Tainan and Kaohsiung over the next three years, with the ministry providing NT$3.31 billion (approx. US$130 million) in subsidies to AMD. In response to Minister of Economic Affairs J.W. Kuo's requirement that 50% of employees for foreign companies be recruited from abroad, AMD has promised that around 200 employees will be hired from overseas and won't compete for talent with Taiwan-based companies.
MOEA officials stated that to position Taiwan as a center for advanced semiconductor manufacturing processes, the ministry has drafted and submitted a plan to the Legislative Yuan for review. As part of its effort to encourage companies to develop advanced process chips, the MOEA is offering subsidies, and 56 IC design companies have already applied, with the total funding amounting to around NT$10.557 billion.
As of now, technical reviews of around 50 applications have been completed. The final list of approved subsidies is expected to be announced by the end of September 2024. If everything proceeds smoothly, the proportion of advanced process chip output in Taiwan's IC design industry could rise to 43%.
Officials noted that TSMC has donated three 12-inch semiconductor manufacturing and inspection equipment units to a government institution, which can be used to establish trial production lines for advanced semiconductor processes and heterogeneous integration. This donation will also benefit academic research in related fields.
The government believes it is necessary to subsidize advanced processes because, besides MediaTek, Taiwan also has many small and medium-sized IC design houses. If these companies lack the capability to design using advanced processes, it would negatively impact innovation in the industry, making it difficult to achieve the goal of doubling Taiwan's global share in IC design.
The mature process is almost entirely dominated by Chinese IC design houses, making it difficult for Taiwanese firms to survive in this competitive environment. Currently, Taiwan's panel industry is facing cutthroat competition from China, forcing companies like AUO and Innolux to sell off factories as they attempt to survive and transform.
However, the government has not ceased its R&D subsidies. If the budget is approved, plans to continue the subsidies in 2025 are in place.
The MOEA will host the "Taiwan Global Investment Forum" on September 3 and the "Taiwan-Japan Investment Forum" on November 26. As in previous years, many foreign companies are expected to attend and sign Letters of Intent (LoIs) with the MOEA. Data showed that over 1,500 companies have passed the review process under the "Three Major Investment Plans in Taiwan," with a total investment amount of NT$2.3244 trillion.
