Summary of Research Findings

In recent years, the global semiconductor market has faced increasing hegemonic competition between the economic giants, the United States and China. Because of these geopolitical risks, semiconductor supply chains have become decentralized and diversified. Southeast Asia has increased its presence to become a part of the global semiconductor supply chain due to its neutral diplomatic stance, low labor and energy costs, government incentives to support the semiconductor business, and future potential for economic growth. The semiconductor market in Southeast Asia consists of six major countries, each with specific characteristics due to the impact of factors such as unique resources, infrastructure environment, technological capabilities of human resources, and the level of semiconductor policy progress.  

Noteworthy Topics

Roles of Six Southeastern Countries in Global Semiconductor Supply Chain and Future Direction

The role of six Southeast Asian countries in the global semiconductor supply chain differ by the country and their roles are diverse. In the situation where global semiconductor market has been unstable, each country needs not only a short-term and mid-term trading strategy, but also a long-term policy to secure sustainable competitive strength, as well as specific strategies to achieve such a policy. Characteristics and future directions of the semiconductor market of each six Southeast Asian country are as follows:

Singapore:
The country leads the semiconductor industry in Southeast Asia, as it has the entire semiconductor ecosystem from the front-end process of IC design and wafer fabrication to the back-end processes of IC assembly and test.  
*1) The semiconductor ecosystem is the alliance between semiconductor market players, such as semiconductor manufacturers, semiconductor fabricators, semiconductor material manufacturers as well as traders, and semiconductor peripheral industries, such as IT services, to form an economic sphere.

Malaysia
The country has companies and human resources with abundant experiences in the back-end process of ATP (Assembly, Testing, and Packaging). While it functions in accepting expanding demand for semiconductors, its national strategy fuels further advancement in back-end processes while aiming to be the added-value market to provide IC design and wafer fabrication.

Vietnam
Vietnam is developing an aggressive policy to attract foreign investment in the semiconductor sector. Aiming to become a human resource hub for semiconductor engineers (*2), the government will follow Malaysia's lead in back-end processes by encouraging the establishment of new factories by foreign capital.
*2) Aiming to nurture domestic semiconductor engineers and even supply human resources to neighboring countries in the future, the country is eager to develop human resources through the government's human resources development strategy and cooperation with foreign semiconductor manufacturers entering Vietnam.

The Philippines
The country focuses on enhancing back-end processes and developing human resources under the initiative of the U.S. trading and economic policy.

Thailand and Indonesia
With the increased demand for semiconductors caused by the rise of electric vehicles (EVs) as a new market opportunity, Thailand and Indonesia are looking to establish a supply chain that covers from battery production to EV semiconductor supply.

Research Outline