Foreign Direct Investment in the Semiconductor Industry: Policy Perspective
Foreign Direct Investment in the Semiconductor Industry: Policy Perspective

Summary/Abstract: Aim: The goal of the article was to identify and quantify policies regarding FDI in the semiconductor industry in the major economies (the USA, the EU, China, Japan, Korea), and to evaluate their impact on attracting new investment projects to selected economies. Methodology: The method applied was the analysis of policies towards semiconductors. The main source of data was Global Trade Alert containing major policy changes towards international business. The database was then supplemented with detailed studies of policies in selected countries. Results: The main finding of the study was that economies with strong positions in the semiconductor industry still heavily support companies in expanding their production and technological capabilities. The support frequently entails incentives for foreign companies to localise the production of advanced technologies. Implications and recommendations: FDI in semiconductors has been closely linked to national policies and plays an important role in fulfilling the competence gap. However, FDI in semiconductors has been subject to many limitations due to the direct linkages between transfer of capital to transfer of knowledge. Originality/value: The novelty of the applied approach stems from distinguishing between policies towards domestic investment and FDI. Prior evidence treated these two types of investments jointly. The focus on FDI is important as computer chips are produced by multinational enterprises and the semiconductor industry has been among the main recipients of FDI globally.

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