NXP Semiconductors NV and Vanguard International Semiconductor Corp, backed by TSMC, are forming a $7.8 billion joint venture named VisionPower Semiconductor Manufacturing Company (VSMC) in Singapore.

The facility will begin production in 2027, focusing on 12-inch wafers for 130-40nm chips for various industries.

Vanguard will hold a 60% stake with a $2.4 billion investment, while NXP will own the remaining 40%.

This initiative aligns with the trend of global tech firms investing in Southeast Asia to mitigate geopolitical risks and lower costs.

The project is expected to create 1,500 jobs in Singapore, contributing to the country's tech industry growth.

Other chipmakers, including UMC, are also expanding in Singapore to follow TSMC's global expansion strategy.