Why Does Taiwan Dominate The World’s Semiconductor Supply?

Despite being a relatively small island with a population of around 23 million people and a land area of just 36,197 square kilometers, Taiwan has established itself as the world’s leading producer of semiconductors, a critical component in global technology. The semiconductor industry is a massive economic force, with the global market estimated to be worth over $600 billion annually. Taiwan produces about 60% of the world’s semiconductors overall, with a particular focus on advanced chip manufacturing. This dominance is due to strategic investments, government support, technological leadership, and strong global partnerships.

Key Factors Behind Taiwan’s Semiconductor Dominance:

Early Investments and Government Support:

• In the 1980s, Taiwan’s government recognized the potential of the semiconductor industry and made it a national priority, providing significant investment and support. The creation of the Taiwan Semiconductor Manufacturing Company (TSMC) in 1987 was pivotal, as it became the world’s largest dedicated independent semiconductor foundry. TSMC’s focus on manufacturing chips for other companies allowed it to work with multiple global clients and build expertise in cutting-edge manufacturing processes.