According to The Wall Street Journal (WSJ), Taiwan Semiconductor Manufacturing Company (TSMC) has begun negotiations with Singapore’s Economic Development Board to secure incentives for the establishment of chip manufacturing facilities.

According to the publication, initial discussions focused on a potential billion-dollar investment in a plant that uses 7nm and 28nm technologies.

According to the WSJ, the Singapore government is looking to secure essential component supplies.

TSMC‘s interest in Singapore follows plans to build a new production facility in its home market, expand into Europe and Japan, and build a $12 billion factory in the United States.

In 2022, the chipmaker plans to invest $40 billion to $44 billion in capital expenses, up from $30.4 billion in 2021. In order to avoid bottlenecks and reduce its dependency on China as a manufacturing base, TSMC plans to increase output and diversify manufacturing regionally.