TAIPEI (Taiwan News) — The Ministry of Economic Affairs said Wednesday it will invest NT$5 billion (US$164 million) over the next five years to boost Taiwan’s semiconductor equipment self-sufficiency.

At the opening of the Semicon Taiwan trade show in Taipei, the ministry said it has supported 29 projects so far and will accelerate efforts in panel-level and silicon photonics packaging, per CNA. The plan aims to reduce research risks and drive adoption of advanced technologies.

The Industrial Development Administration joined 16 domestic firms to set up a pavilion showcasing equipment for heterogeneous integration and silicon carbide processing. Officials said the display underscored government backing for a more resilient supply chain.

IDA Director General Chiu Chiu-hui (邱求慧) said demand for AI and high-performance computing is fueling rapid growth, with output from Taiwan’s equipment sector projected to exceed NT$180 billion this year, an 18% jump from last year.

To align with leading players such as TSMC and ASE, the ministry’s verification program focuses on advanced packaging and component development. Companies including Grand Process Technology Corporation and Skytech have emerged as top suppliers in the CoWoS packaging field.

Grand Process, for example, has created wet-etching tools with AI monitoring that lift yields by 5% and recycle over 98% of etching solutions. With a 70% share of Taiwan’s wet-process equipment market, the company reflects how local firms are shaping the next stage of semiconductor growth.