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Semiconductor War Heats Up in South-East Asia

Thailand, Vietnam and Singapore are all vying to become a regional leader in the semiconductor manufacturing industry. The chip making business is now gaining momentum on the global stage thanks to the demands of artificial intelligence technology and electric vehicles.


For Thailand, the country’s Board of Investment (BOI) said it would propose new measures to fast-track investments in upstream manufacturing to the government under Prime Minister Paetongtarn Shinawatra, with a focus on two main industries: Semiconductors and batteries.


BOI secretary-general Narit Therdsteerasukdi said the BOI proposed setting up the “Semiconductor Board” to specifically supervise the investment in this crucial industry as well as to attract corporations in the US and Europe to invest in Thailand in the next few years.


Thailand’s eastern neighbor Vietnam, meanwhile, is drafting a new digital technology industry (DTI) law that offers several privileges to global chip makers investing in the country, according to a Nikkei Asia’s report.


The report said the DTI law offers up to 150% tax rebate on research and development expenses of new innovations, as well as up to 10 years’ free usage of land and fast-track visas for foreign experts.


Companies investing more than US$160 million would be entitled to fast-track registration and exemption on selected raw materials and equipment, the report added.


Nikkei Asia noted that US semiconductor giant Nvidia is in talks with Vietnam’s FPT Corporation to build a research and development facility for AI technology. Netherlands’ chipmaker Besi also announced an investment of US$164 million in Vietnam.


Singapore, meanwhile, is expanding its decades-long domination in the semiconductor industry in the region following the two-day visit of Indian Prime Minister Narendra Modi on Thursday.


Modi met with Singaporean counterpart Lawrence Wong and signed four memoranda of understanding aimed at deepening cooperation in areas such as semiconductors, digital technology, skills development and healthcare, according to the Indian government.


On chip production, Singapore will support India's growing industry, while India will promote the entry of Singaporean companies and the development of supply chains in its huge market, Nikkei Asia reported.


Despite its small area and high operating costs, Singapore accounts for 10% of global chipmaking output, and around 20% of semiconductor manufacturing equipment production.

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