The value of Taiwan’s semiconductor production equipment sector is likely to top NT$100 billion (US$3.18 billion) amid continued strong global demand for emerging technologies, according to the Ministry of Economic Affairs (MOEA).
The estimate was made by the MOEA after Taiwan-made semiconductor equipment’s output for the first eight months of this year rose 16.5 percent from a year earlier to NT$86.5 billion (US$2.75 billion).
If the ministry’s forecast is correct, the production value of Taiwan’s semiconductor equipment will surpass the NT$100 billion level for the second year in a row in 2022.
In 2021, the sector recorded total output of NT$118.6 billion, up 33.6 percent compared with 2020, the MOEA said in a statement released earlier this week.
According to the MOEA, semiconductor suppliers are keen to invest in high-end processes in Taiwan, which has helped to strengthen the industry at a time of strong global demand for emerging technologies such as 5G applications, the Internet of Things, high-performance computing devices and automotive electronics.
Although the semiconductor industry has scaled back their spending for 2022 due to inventory adjustments, this is a temporary measure for most firms, and demand for equipment is expected to remain solid this year, the MOEA added.
Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, has decided to cut its capital expenditure budget to US$36 billion from the lower end of an earlier forecast range between US$40 billion and US$44 billion for 2022, citing short-term market uncertainty.
However, TSMC’s total capex is still a market leader as it continues developing advanced technologies, including its 3-nanometer and 2nm processes, to maintain the lead over its peers, market analysts said.
The MOEA said Taiwan was the most important chip production hub in the world, with many foreign IC makers coming here to invest.
Since 2012, the output of the local semiconductor equipment industry has grown year by year, and during the 2012-2021 period, average annual growth in output hit 17.7 percent, the MOEA added.
The MOEA said Taiwanese equipment suppliers had intensified efforts to explore business opportunities overseas, resulting in exports accounting for 45.7 percent of their total sales in 2021, up 14.8 percentage points compared with 2016.
In 2021, exports of Taiwan’s semiconductor equipment totaled US$2.46 billion, a year-over-year increase of 63.2 percent, according to the MOEA.
China was the largest buyer of Taiwan-made semiconductor equipment with purchases making up 45 percent of Taiwan’s total exports in 2021, ahead of Singapore (21.2 percent), the United States (12.7 percent), and Malaysia (6.9 percent), the MOEA said.
Source: Focus Taiwan News Channel