Taiwan dominates global chip production, with China, South Korea, the U.S. and Japan following close behind. Saudi Arabia is also on the hunt for its own, even self-sufficient, chip ecosystem.
Saudi Arabia’s ambitions are largely defined by what’s known as the Vision 2030 initiative. This involves a large number of investments, including the Alat project, which is contributing nearly 10 billion dollars to it. By 2030, it should have created 39,000 jobs on its own.
Earlier, the Middle Eastern state launched a brand-new National Semiconductor Hub. The main thrust of this initiative is to attract at least 50 semiconductor design companies.
Allies
We reported earlier this year that OpenAI CEO Sam Altman is interested in the Middle East’s chip potential. He was visiting the United Arab Emirates (UAE) and stressed the importance of AI infrastructure in the region. Part of that was a search by the OpenAI chief for backers for a possible proprietary AI chip. Altman’s ambitions transcend UAE borders: a global coalition of both national governments and companies would be needed to fully exploit AI technology.
Interest in the Middle East in this area is already there. Yet there are very divergent interests. Sam Altman’s plans to build AI chips would assume that TSMC would make them. Meanwhile, Saudi Arabia itself hopes to play a significant role in this production, something that is bound to be a longer-term plan. Intel, for example, which has been aspiring to become a full-fledged TSMC competitor for two years, still has significant investments to make before it becomes competitive on a large scale.
National interest
Saudi Arabia will have to contend with ambitious plans in Europe and the U.S. to increase their share of chip production, as well, which they attain mostly through TSMC and Intel facilities. The Saudis may try to attract chip designers as well as these chip manufacturers, but the competition is already significant.
Domestically, economist Talat Hafiz believes Saudi Arabia has many advantages. The country is investing heavily in chip-dependent sectors such as AI, 5G and the automotive world. In any case, energy supplies should not be a problem, several sources report to Arab News. The growth plan targets an economic impact for Saudi Arabia as significant as that of oil. There’s no shortage of ambitions, then.
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