By Dr. TUNG Chen-Yuan, PhD, Taiwan’s Representative to Singapore
As the global semiconductor industry enters a new AI-driven supercycle, geopolitics is simultaneously reshaping supply chains and accelerating shifts in the global technology power structure. In an era of heightened uncertainty, Singapore—supported by institutional stability, mature industrial clusters, and deep international connectivity—is steadily emerging as one of Southeast Asia’s most technologically sophisticated semiconductor hubs.
Data from the Singapore Economic Development Board (EDB) indicate that Singapore produces about 10% of the world’s semiconductors and manufactures roughly 20% of global semiconductor equipment. In 2025, the semiconductor sector reached S$160.2 billion (about US$ 122.7 billion), representing a 17.1% increase from 2024. The industry accounts for 33.4% of Singapore’s total manufacturing output, generates approximately S$ 46 billion in value added (about 5.8% of GDP), and employs more than 34,000 highly skilled workers. Between 2019 and 2025, the sector recorded a compound annual growth rate (CAGR) of 8.8%, demonstrating strong and steady growth momentum.
In terms of manufacturing, Singapore is an important global production base for NAND flash memory. Approximately 98% of Micron Technology’s NAND chips are produced in Singapore. Integrated device manufacturers such as Infineon and STMicroelectronics have also established operations there spanning both front-end wafer fabrication and back-end processes, highlighting Singapore’s long-standing attractiveness for high value-added manufacturing.
In wafer foundry manufacturing, Singapore also serves as a key front-end production base in Southeast Asia. GlobalFoundries operates one of its largest 12-inch wafer fabs in the country. United Microelectronics Corporation (UMC), after investing US$ 3.6 billion to build a fab in 2001, committed an additional US$ 5 billion in expansion in 2022 and began mass production of 22- to 28-nanometer processes in 2025. Meanwhile, VSMC—a joint venture between Vanguard International Semiconductor and NXP—has invested US$ 7.8 billion to build a 12-inch specialty process wafer fab. These investments not only expand production capacity but also strengthen Singapore’s strategic role in the regional wafer manufacturing ecosystem.
In the field of packaging and testing, Singapore is gradually establishing a differentiated position in high-precision and high-reliability packaging. Companies such as ASE, JCET, and UTAC have established operations there, primarily serving markets such as automotive and industrial electronics, where quality and safety standards are extremely demanding. As global supply chains increasingly prioritize resilience, traceability, and compliance, Singapore’s strategic importance in high-reliability application supply chains continues to grow.
The resilience of Singapore’s semiconductor industry is also rooted in a highly coordinated policy framework. The Economic Development Board has long attracted multinational corporations through investment incentives and industrial facilitation. Under the “Manufacturing 2030” strategy, Singapore aims to increase manufacturing output by 50% while maintaining manufacturing’s share of GDP at around 20%. At the same time, the government has launched the Electronics Industry Transformation Map, focusing on productivity, innovation, skills development, and internationalization.
In terms of industrial infrastructure, JTC Corporation currently manages four wafer fabrication parks covering approximately 374 hectares, with plans to expand available land by about 11% to accommodate hardware demand driven by AI growth. The government has also raised its R&D budget to around S$ 28 billion to support semiconductor design, process technologies, and equipment research. Through tax incentives and financial support, Singapore has effectively reduced capital expenditure pressures for firms. According to analysis by the US Department of Commerce, these policies can lower the total cost of semiconductor facilities by approximately 25% to 30%, creating a significant competitive advantage in this highly capital-intensive industry.
Entering 2026, Singapore’s industrial strategy is shifting from a traditional manufacturing base toward advanced manufacturing and advanced packaging, particularly in high-bandwidth memory (HBM) and AI semiconductor supply chains. Micron has designated Singapore as its global NAND manufacturing center of excellence and plans to invest US$ 24 billion over the next decade to build new wafer fabs. At the same time, it is investing US$ 7 billion in HBM advanced packaging facilities scheduled to begin operations in 2026, allowing Singapore to move more directly into the core of the AI hardware supply chain.
In advanced packaging, the startup Silicon Box reached a milestone of shipping 100 million units in 2025, demonstrating the scalability of its panel-level packaging technology. GlobalFoundries has also acquired AMF and partnered with Singapore’s Agency for Science, Technology and Research (A*STAR) to establish a silicon photonics center of excellence focused on high-speed data transmission technologies exceeding 400 Gbps. These developments highlight an important trend: in the AI era, packaging and interconnect technologies are becoming the semiconductor industry’s new competitive frontier.
Facing intensifying global technological competition, Singapore is concentrating resources on next-generation technologies such as heterogeneous integration, advanced packaging, silicon photonics, and wide-bandgap materials. Over the next five years, Singapore will increase R&D investment to S$ 37 billion. The government has also announced S$ 800 million for a flagship semiconductor research program and S$ 500 million to establish the National Semiconductor Translation and Innovation Centre (NSTIC), supporting the development of power semiconductor technologies such as GaN and SiC for electric vehicles and renewable energy applications.
However, Singapore’s transformation also faces two structural challenges: talent and compliance. Southeast Asia currently faces a shortage of approximately 34,000 semiconductor engineers. Singapore is addressing this gap by relaxing policies for foreign talent, expanding postdoctoral research funding, updating higher-education curricula, and promoting interdisciplinary training.
At the same time, amid rising export controls and geopolitical tensions, Singapore has strengthened technology compliance management. In 2025, Singapore Customs and the Ministry of Trade and Industry issued a joint advisory on export controls for advanced semiconductors and AI technologies, requiring companies to establish internal compliance mechanisms in order to preserve Singapore’s reputation as a trusted global technology hub.
Overall, as geopolitical restructuring and technological transformation reshape the semiconductor landscape, Singapore is consolidating its industrial foundation through mature process technologies and high-reliability manufacturing. At the same time, coordinated industrial policies and sustained R&D investment are enhancing technological capabilities, while advances in packaging, HBM, silicon photonics, and power materials position the country to meet emerging demands from AI and the global energy transition. As global supply chains continue to evolve, Singapore is increasingly becoming a critical node in the next phase of the global technology landscape.
About the Author:
Dr. Tung Chen-Yuan is currently Taiwan’s Representative to Singapore. He was Minister of the Overseas Community Affairs Council of the Republic of China (Taiwan) from June 2020 till January 2023. He was Taiwan’s ambassador to Thailand from July 2017 until May 2020, senior advisor at the National Security Council from October 2016 until July 2017, and Spokesman of the Executive Yuan from May to September 2016. Before taking office, Dr. Tung was a distinguished professor at the Graduate Institute of Development Studies, National Chengchi University (Taiwan). He received his Ph.D. degree in international affairs from the School of Advanced International Studies (SAIS), Johns Hopkins University. From September 2006 to May 2008, he was vice chairman of the Mainland Affairs Council, Executive Yuan. His areas of expertise include international political economy, China’s economic development, and prediction markets.
