June 2, 2025 – Taiwan Semiconductor Manufacturing Company (TSMC), the world’s leading semiconductor foundry, today announced that it is in advanced discussions to evaluate the feasibility of establishing a state-of-the-art “gigafab” production complex in the United Arab Emirates (UAE). If realized, this facility would be similar in scale to TSMC’s ongoing Arizona investment, underscoring the company’s commitment to strengthening global semiconductor supply chains and supporting emerging technology hubs.
TSMC has held multiple meetings over recent months with U.S. Special Envoy to the Middle East Steve Witkoff and representatives from MGX, a UAE-based investment platform backed by the nation’s leadership. These discussions reflect both TSMC’s desire to deepen partnerships in the Gulf region and the UAE’s ambition to position itself at the forefront of the global artificial intelligence (AI) and advanced manufacturing ecosystems.
TSMC’s proposed “gigafab” in the UAE would consist of six interconnected wafer fabrication facilities, mirroring the design and capacity approach of its Phoenix campus, which represents a US$165 billion investment that also includes research and packaging operations. The projected cost of a comparable facility in Abu Dhabi remains under evaluation.
Key collaborators in these preliminary talks include:
MGX Fund Management: An influential investment vehicle co-launched by Abu Dhabi’s Mubadala Investment Company and G42, the UAE’s leading AI investment arm.
U.S. Government Entities: TSMC has engaged with senior U.S. officials to secure necessary approvals and address national-security considerations related to overseas chip manufacturing.
TSMC Leadership: Under the guidance of CEO C.C. Wei, TSMC continues to balance its global expansion strategy, ensuring alignment with existing projects—most notably its Arizona “Fab 21” which is sold out through late 2027.
Regulatory and National-Security Considerations
While the UAE welcomes foreign investment in critical technology sectors, the final decision will depend on achieving the right balance between TSMC’s operational objectives and the strategic interests of partner governments. U.S. stakeholders have expressed concerns that diverting key engineers and resources towards a new Gulf facility could impact TSMC’s Arizona timeline—and potentially introduce geopolitical risks, given the broader regional context involving China and Iran.
TSMC’s policy remains to not comment on market rumors; however, the company is actively exploring all options to support global demand for advanced logic nodes—especially as AI workloads drive ever-higher chip complexity and local production becomes a strategic imperative.
Timeline and Next Steps
At this stage, any groundbreaking in the UAE is not anticipated for several years. TSMC continues to conduct feasibility studies, secure regulatory clearances, and align stakeholder interests. Should the project proceed, milestones will include:
Finalizing Land and Infrastructure Agreements: Working with UAE authorities to identify suitable sites and develop necessary utilities.
Securing Washington’s Support: Engaging with U.S. policymakers to address national-security protocols, export controls, and workforce allocation.
Detailed Engineering and Permitting: Conducting environmental impact assessments and obtaining construction approvals.
Construction and Equipment Procurement: Aligning with equipment suppliers (including ASML and others) to support cutting-edge EUV lithography needs.
