Taiwan is set to become the second largest manufacturer of semiconductors in Asia, overtaking Korea for the first time, according to the Japan External Trade Organization (JETRO). Taiwan’s chip production grew 1.5% last year, while chip production in Asia as a whole shrank by 10.5%. JETRO expects Taiwan to draw level with Japan in production stakes by 2000.

The growth in chip production is being driven by Taiwan’s foundry sector and increased technological ties with the US and Europe. The world’s largest foundry producer of made-to-order chips, Taiwan Semiconductor Manufacturing expects record sales and 100% capacity usage this year. Meanwhile, Worldwide Semiconductor Manufacturing has said that it plans to spend over $1bn on a new fab this year to meet rising demand. IC design house Via Technologies Ltd has also had a good deal of success getting memory manufacturers behind its PC133 SDRAM specification.