According to market research firm Yole Group, China will account for 30% of global production capacity and emerge as the world’s largest semiconductor foundry hub by 2030. Taiwan leads at 23%, followed by South Korea at 19%, Japan at 13%, the U.S. at 10%, and Europe at 8%. This is a huge increase from its current 21%. China’s aggressive investments in domestic semiconductor manufacturing, which are motivated by Beijing’s ambition to become self-sufficient in chip production, are the main cause of this change.
China’s semiconductor production reached 8.85 million wafers per month in 2024, a 15% increase from the previous year. By 2025, it is expected to reach 10.1 million. The construction of 18 new semiconductor factories, including Huahong Semiconductor’s new 12-inch fab in Wuxi, which started production in early 2025, has been the main driver of this growth. The expansion of the nation’s production capacity is essential to its aspirational goals of controlling the global semiconductor market.
Despite having only 10% of the world’s production capacity, the United States continues to be the world’s largest wafer consumer, meeting about 57% of the demand. As a result, the rest of its supply comes from outside producers such as China, Taiwan, and South Korea. In the meantime, production in Europe and Japan meets domestic demand, making them essentially self-sufficient. About 6% of the world’s foundry capacity is contributed by other nations, primarily China and the United States, including Singapore and Malaysia.
Nevertheless, the increasing capacity for semiconductor production in the United States, especially from firms like TSMC, Intel, and Samsung, was not taken into account in the Digitimes report. The United States is well-positioned to increase its proportion of the world’s wafer production as new fabs are being built in Arizona and elsewhere.
The technological race is still unclear, even though China is expected to lead in output. China’s access to advanced machinery is hampered by the U.S.’s implementation of export restrictions on the newest technologies used in semiconductor manufacturing. Beijing, however, is making significant investments to develop its own capabilities, which may eventually help close the technological divide between China and its Western neighbours.
