A global supply chain shortage of semiconductors will prompt changes in global FDI patterns in manufacturing facilities. By Lara Williams, Investment Monitor
A geographic monopoly of the design and manufacture of semiconductors, specifically in Taiwan and South Korea, has prompted governments and companies alike to re-evaluate supply chains and manufacturing locations. Significant shifts in announced foreign direct investment (FDI) projects are expected for 2022.
Our FDI project database tracked semiconductor inward investment throughout 2019 and 2020 and found that there were no surprises in the highest-ranking countries in terms of new cross-border semiconductor project numbers. China attracted the highest number of projects, followed by Germany, the US, India and Taiwan.
Locations with significantly lower project volumes but greater growth in FDI semiconductor projects show a pattern of investment throughout the Asia-Pacific region, close to but not including South Korea or Taiwan. Although these locations show minimal project numbers of fewer than ten projects, the growth is worth noting. Australia saw a threefold increase in semiconductor FDI projects between 2019 and 2020, Malaysia saw a 250% increase and Vietnam 166%. Hungary, Canada, France, Mexico and Singapore also saw increases.