The macro impact of the AI boom in Taiwan and South Korea

The launch of ChatGPT in November 2022 made 2023 a leap forward for artificial intelligence (AI). The big battle for the future AI winners heated up and many tech companies revealed their future investment plans during the latest earnings season. A global race to build the most powerful AI chips has begun, which will potentially revolutionise the global tech sector.

What you will learn:

• The battle for artificial intelligence (AI) started to heat up during the latest earnings season of global tech companies. The global market size of AI chips is projected to grow by 20% or more during the next three to five years.
• Taiwanese and South Korean companies, which control the majority of global chip fabrication capacity, have the edge in manufacturing AI chips and will have an impact on their countries’ macroeconomic growth in the following years.
• The latest GDP data suggest that the semiconductor industry accounted for 22.3% of Taiwan’s GDP and 10.0% of South Korea’s. As our current baseline industry forecast suggests, the semiconductor market could grow by around 8% for the next five years.
• The expected exploding demand for AI chips will require an equivalent expansion of industry capacity and a huge supply of power. These will take time to materialise.