Taiwan Semiconductor Manufacturing Co (ADR) (NYSE:TSM) and Samsung Electronics (KRX:005930) are in talks to establish large chip factories in the United Arab Emirates to meet the growing demand for artificial intelligence technology, The Wall Street Journal reported.
TSMC executives recently visited the UAE to discuss a potential plant complex similar to their advanced facilities in Taiwan. Samsung has also sent representatives to explore similar opportunities, the paper added.
However, these discussions are in the early stages and face several challenges, including technical and financial hurdles. The estimated cost for such projects could exceed $100 billion.
While TSMC is currently focused on global expansions in the US, Japan, and Germany, the UAE is positioning itself as a key player in AI and semiconductor development.
The Gulf nation is working to diversify its economy, with Abu Dhabi-based G42 playing a central role in AI initiatives and forming partnerships with companies like Microsoft and Nvidia.