TSMC and Samsung are weighing major semiconductor manufacturing projects in the United Arab Emirates, according to discussions described in the source article. The proposals are still not final, but they point to a much larger ambition: expanding global chip production while placing sensitive AI-related supply chains under close political scrutiny.
A proposed UAE semiconductor buildout
TSMC executives have discussed building a multi-factory complex in the UAE that could rival the company’s largest and most advanced facilities in Taiwan. The project would include several factories and could cost more than $100 billion.
Samsung is also considering new chip plants in the UAE in coming years. The source article makes clear that no final decisions have been made, so the plans should be read as active discussions rather than confirmed construction projects.
The strategic goal behind the talks is broad but specific: increase global chip production and help lower prices without damaging chipmakers’ profits. That balance matters because advanced semiconductor manufacturing is capital-intensive, and the companies involved would need any expansion to make commercial sense as well as strategic sense.
How the financing could work
Under the proposed terms, the UAE would finance the projects. Abu Dhabi’s Mubadala investment fund would play an important role in the broader effort to build a domestic technology industry.
The source also connects this effort to MGX, a sovereign wealth fund that is reportedly in chip talks with OpenAI. A Mubadala spokesman said it is in "regular dialogue with partners around the world" but has no concrete plans to announce.
That distinction is important. The UAE is described as an active backer and possible financier, but the public details remain limited. The article does not say that construction has been approved, that factory sites have been chosen, or that production timelines have been set.
AI ambitions sit behind the factory talks
The semiconductor discussions fit into Abu Dhabi’s wider technology strategy. The source article says Abu Dhabi aims to create a "national champion" for AI investments through its new fund.
Sheikh Tahnoon bin Zayed al-Nahyan, the UAE president's brother, oversees the fund and AI firm G42. G42 partners with OpenAI, Microsoft and Cerebras.
That context helps explain why chip manufacturing is part of the conversation. Advanced AI systems depend on powerful chips, and countries seeking a larger role in AI also need access to reliable semiconductor supply. The proposed UAE projects would therefore be more than ordinary industrial facilities; they would sit at the center of a technology strategy involving AI investment, chip capacity and international partnerships.
Why U.S. oversight is part of the proposal
The factory plans are also tied to political concerns around the U.S.-China AI race. TSMC and Samsung are speaking with U.S. officials who are concerned about advanced AI chip supplies reaching China, which is a trading partner of the UAE.
One idea under discussion is U.S. oversight of chip production and shipments from the UAE plants. The details have not been finalized, but the concept shows how semiconductor expansion is being shaped by security concerns as much as by manufacturing demand.
A US National Security Council spokesperson told the WSJ: "We have worked extensively with the U.A.E. on areas of advanced technology over the last two years, and the partnership is moving in the right direction."
For TSMC and Samsung, that means any UAE project would likely need to satisfy several groups at once: the companies looking at long-term production economics, the UAE entities offering financing, and U.S. officials focused on where advanced chips could ultimately go.
What remains unresolved
The most important point is that the plans are still under discussion. The source article does not present the TSMC or Samsung projects as approved, funded construction programs with fixed launch dates. It describes active talks involving companies, UAE backers and U.S. officials.
Several major questions remain open based on the available information:
- Whether TSMC will move ahead with a UAE complex costing more than $100 billion.
- Whether Samsung will decide to build new chip plants in the UAE in coming years.
- How U.S. oversight of production and shipments would work in practice.
- How the projects would support global chip production while preserving chipmakers’ profits.
Even without final decisions, the discussions show how semiconductor manufacturing is becoming a shared concern for companies, governments and investment funds. The UAE may provide financing, TSMC and Samsung may bring manufacturing expertise, and the U.S. may seek oversight because advanced chips are central to AI competition.
If the plans advance, the UAE could become a more significant location in global semiconductor production. For now, the clearest takeaway is that chip factories are no longer just about capacity. They are also about AI strategy, supply control and the political rules that shape where the world’s most important chips are made and shipped.