Taiwan Semiconductor Eyes UAE for New Chip Plant Amid Renewed Talks

Taiwan Semiconductor Manufacturing Company (TSMC), the world’s leading contract chipmaker, has resumed negotiations to potentially establish a new semiconductor plant in the United Arab Emirates (UAE). These talks, previously put on hold toward the end of President Joe Biden’s term, have been reignited, signaling renewed interest in expanding production capabilities outside East Asia.

According to Bloomberg, executives from TSMC have held several meetings with Steve Witkoff, the U.S. Special Envoy to the Middle East, and senior representatives of MGX, an advanced technology investment firm headquartered in Abu Dhabi. MGX was co-founded in 2023 by Mubadala Investment Company, the UAE’s sovereign wealth fund, and G42, the region’s major artificial intelligence (AI) investor.

While no definitive timeline has been announced, the discussions suggest that a Taiwan Semiconductor factory in the UAE is a long-term possibility. Setting up a TSMC manufacturing site of this scale is expected to take several years.

The news comes amid deepening U.S.-UAE tech cooperation, highlighted by the May 2025 announcement of Stargate UAE, a massive 10-square-mile AI campus in Abu Dhabi, slated to go live in 2026. The project will be powered by 5 gigawatts of energy and utilize hundreds of thousands of NVIDIA GPUs—making it one of the largest AI infrastructure initiatives globally.

This development was made possible after the U.S. government lifted export restrictions on advanced chip technologies to the UAE, following the country’s pledge to increase investment in the U.S. and sever its AI partnerships with Chinese firms through G42.

Last year, The Wall Street Journal reported that both TSMC and Samsung Electronics were evaluating plans to establish mega-manufacturing semiconductor facilities in the UAE. These initiatives are believed to involve significant funding support from Mubadala, further cementing the UAE’s role as an emerging global hub in the semiconductor industry.
For investors, this strategic move could have long-term implications for Taiwan Semiconductor stock, also known as TSMC stock NYSE (listed under TSMC or Taiwan Semi stock), as well as the broader tech supply chain. As Taiwan Semiconductor Mfg continues to explore global expansion, market watchers are closely monitoring the implications for digital infrastructure, business transformation, and chip sovereignty.