Taiwan produces 90% of the world’s AI servers – raising concerns as US-China trade conflicts continue to simmer

Key Points:

  • Taiwan dominates the global AI server market, capturing 90% share.
  • AI server demand is high, prices are rising sharply, and key components are significantly more expensive than general server components.
  • Taiwanese companies are making strategic investments globally, reducing industry geo-concentration.


Taiwan currently maintains a dominant position in the global artificial intelligence (AI) server market, controlling a staggering 90% share according to a recent report by DigiTimes. This success was underscored during a briefing held by the Taiwanese government, with President-elect Lai Ching-te and 20 Information and Communication Technology (ICT) industry leaders in attendance. The event, organized by Taiwan’s Ministry of Economic Affairs (MOEA), aimed to assess the current state of the ICT industry and explore avenues for future growth.


The meeting highlighted the immense demand for AI servers, with prices soaring and quotes on an upward trajectory. Notably, key components for AI servers, such as substrates and cooling equipment, command substantially higher prices compared to general server components. Taiwan, renowned for its advanced semiconductor manufacturing capabilities, already produces 83% of the world’s servers. However, this figure rises to 90% for AI servers, reaching 100% when factoring in American brand vendors.


Despite Taiwan’s significant contributions to the tech industry, concerns loom over the geopolitical implications of this market dominance. The reliance of US-branded AI servers entirely on Taiwanese manufacturing raises apprehensions, prompting initiatives in the US and EU to bolster local semiconductor manufacturing ecosystems. Taiwan, in an attempt to mitigate geo-concentration risks, has made strategic investments in various countries worldwide, diversifying its presence and influence.


Moreover, the MOEA revealed compelling statistics indicating Taiwan’s production of 78% of the world’s laptops and 55% of PCs. Discussions during the briefing encompassed diverse topics such as 6G technology, sustainability, low-carbon manufacturing, green energy initiatives, and talent attraction strategies aimed at enhancing Taiwan’s competitive edge and industry sustainability.



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