Taipei, Sept. 29 (CNA) Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chip maker, has announced that it has chosen the Tainan Science Park in southern Taiwan as the site of its planned 3 nanometer chip production plant.

The choice will allow TSMC to take full advantage of the company's existing business cluster and supply chain at the park, TSMC said in a statement on Friday.

TSMC also thanked the government for promising to help the company solve issues regarding land acquisition, water and power supply, and environmental protection.

The facility is the world's first-announced investment in the advanced 3nm process, ahead of main competitors such as Samsung of South Korea and Intel of the United States. The total amount of the investment remains unclear.

TSMC, which holds a global market share of more than 50 percent in the pure play foundry business, has been keen to upgrade its production technology in an effort to maintain its dominance in the sector.

The company has been working to develop chips on the 7nm and 5nm processes and is hoping to start mass production in 2018 and 2020, respectively, after it started making 10nm wafers in the fourth quarter of last year.

The company had previously hinted that it might consider locating the plant in the United States if land, water and electricity concerns were not resolved.

In response to TSMC's decision, Premier Lai Ching-te (賴清德) expressed his appreciation to the company's chairman, Morris Chang (張忠謀), for his support for Taiwan.

The planned investment is very helpful to the government's efforts to promote Taiwan's economic development and encourage companies to invest in Taiwan, Lai said.

Minister of Science and Technology Chen Liang-gee (陳良基), said, meanwhile, that he hopes the investment will stimulate other Taiwanese companies to invest in new technologies and encourage more talent to get involved.

Chen said the 3nm plant will likely begin production in 2022, when applications of artificial intelligence are expected to explode, creating a good opportunity for Taiwanese industries to tap into AI-related research and development. 

(By Chang Chien-chung, Chen Chun-hua, Chen Cheng-wei and Y.F. Low)
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