AI, Geopolitics Drive Southeast Asia's High-End PCB Ecosystem

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Driven by growing demand for high-value applications such as AI servers, high-speed networking, and satellite communications, Thailand, Vietnam, and Malaysia are rapidly evolving from traditional consumer electronics manufacturing bases into a complementary regional ecosystem supporting the development of advanced printed circuit boards (PCBs) and IC substrates.

Statistics show that Southeast Asia currently accounts for approximately 12.3% of global PCB production value, reflecting the region’s steadily rising importance in the global electronics industry. However, its current growth momentum remains highly dependent on capacity expansion by foreign-invested companies from Taiwan, China, Japan, South Korea, Europe, and the United States. Local PCB manufacturers still account for only around 1% of global production value.

For Southeast Asia to advance from a manufacturing base into a globally competitive PCB industry hub with greater technological autonomy, the pace at which the region develops its materials, equipment, skilled workforce, and local supply chains will be critical.

Thailand Maintains Southeast Asia’s PCB Leadership, with Production Value Set to Exceed US$6 Billion

Thailand is currently Southeast Asia’s largest PCB manufacturing base. Its PCB production value reached US$5.06 billion in 2025, representing year-on-year growth of 22.4% and approximately 5.4% of global PCB production value.

This expansion has been driven primarily by new production capacity from Taiwanese- and Chinese-invested manufacturers, accelerating the share of advanced applications—including AI servers, high-speed networking equipment, and satellite communications systems—produced in Thailand.

Supported by sustained demand for AI infrastructure, continued investment in data centers and cloud services, and the global trend toward diversified supply chain deployment, Thailand’s PCB production value is projected to increase by another 20.4% in 2026, reaching US$6.09 billion.

On the policy front, the Thai government continues to improve the investment environment through the Thailand Board of Investment (BOI). In the first quarter of 2026, the value of BOI investment applications exceeded US$31.8 billion, highlighted by major data center and cloud infrastructure projects involving global technology companies such as Google and Microsoft.

The Stock Exchange of Thailand is also considering more flexible listing and financing mechanisms to attract additional high-tech investment. These measures are expected to deepen cross-border cooperation across the upstream semiconductor, materials, and PCB supply chains.

From Electronics Manufacturing to Advanced PCBs: Vietnam Accelerates Investment in HDI and IC Substrates

Vietnam has long served as a major global manufacturing base for smartphones, notebook computers, and other electronics products. In recent years, it has also delivered strong growth in PCB production.

Vietnam’s PCB production value reached US$4.15 billion in 2025, up 33.9% year on year and accounting for approximately 4.4% of global production value. It is projected to grow by a further 18.1% in 2026 to US$4.9 billion.

The country’s key growth driver is the rapid expansion of demand for AI and high-performance computing, which is stimulating parallel growth in advanced multilayer PCBs, high-density interconnect, or HDI, boards, and IC substrates.

Vietnam’s PCB investment structure is gradually shifting from supporting downstream electronics assembly toward advanced technologies and the broader semiconductor supply chain. Taiwanese, Japanese, and South Korean companies continue to expand their local presence, with investments spanning AI servers, advanced HDI boards, ABF substrates, and semiconductor assembly and testing.

These developments indicate that Vietnam is no longer merely an electronics manufacturing base. It is moving toward higher-value PCB production and the supporting supply chain for advanced semiconductor packaging.

At the policy level, the Vietnamese government has designated AI, cloud computing, and semiconductors as national strategic technologies. It has also allocated US$110 million through its national technology development fund to support priority industries. Major companies such as Qualcomm and Foxconn are continuing to expand their AI research and development and smart manufacturing operations in the country.

Malaysia Leverages Its Semiconductor Packaging Strength to Build an AI Computing and Advanced Substrate Cluster

Malaysia accounts for approximately 13% of the global semiconductor assembly and testing market and forms a closely interconnected semiconductor supply chain cluster with Singapore.

The country’s PCB production value reached US$2.09 billion in 2025 and is projected to grow by 15.3% to US$2.41 billion in 2026, supported by new capacity expansion and investment in AI infrastructure.

Malaysia’s latest industrial investments are closely aligned with the AI supply chain. Austrian IC substrate manufacturer AT&S announced plans in 2026 to invest up to €2 billion in expanding its Kulim facility to capture growing demand for advanced substrates used in AI applications.

Taiwanese PCB manufacturer Global Brands Manufacture has adopted a complementary production model between Singapore and Malaysia, with its Penang facility responsible for the mass production of AI server boards.

At the policy level, the Malaysian government is advancing its National Semiconductor Strategy and the MyChipStart initiative to support IC design, technology startups, and domestic semiconductor talent development.

Malaysia also continues to attract international data center operators and cloud service providers. With companies such as Australia-based AirTrunk developing large-scale AI data centers in Johor, Malaysia is rapidly emerging as a key AI computing hub in Southeast Asia.

AI Accelerates Regional Specialization, Creating a Dual-Axis Opportunity for Taiwanese PCB Companies

The Taiwan Printed Circuit Association, or TPCA, observes that global investment in AI infrastructure has become a major catalyst for the transformation and upgrading of Southeast Asia’s PCB industry.

Google and Microsoft are increasing their investment in Thailand’s cloud infrastructure, while Vietnam has designated AI, cloud computing, and 5G and 6G communications as strategic national technologies. These policies have helped attract investment such as Qualcomm’s research and development center in Hanoi. Meanwhile, an AI data center cluster is rapidly taking shape in Johor, Malaysia.

Together, these developments are transforming Southeast Asia from a regional electronics manufacturing hinterland into an important node for advanced servers, AI infrastructure, and semiconductor supply chains.

As global supply chains are restructured and demand for AI computing capacity continues to expand, Taiwan’s PCB industry must not only strengthen its domestic capabilities in advanced manufacturing, research and development, and critical supply chain collaboration, but also carefully extend its strategic presence into Southeast Asia.

Although Southeast Asia has become an increasingly important region for global PCB capacity deployment, the successful localization and mass production of advanced products still depend heavily on technology and operational management, the availability of critical materials and equipment, talent development, and customer qualification processes.

For Taiwan’s PCB industry, future competitiveness will no longer depend solely on expanding overseas production capacity. The decisive factor will be how effectively companies allocate resources through a dual-axis model of “R&D in Taiwan and manufacturing overseas” to strengthen global delivery capabilities and supply chain resilience.

TPCA stated that it will continue to deepen its engagement with Southeast Asian markets. In addition to monitoring PCB investment, production capacity, and supply chain developments across the region to help members understand changing market conditions, TPCA will participate in international exhibitions and industry forums in Southeast Asia to strengthen cooperation with local companies, industry associations, and institutional partners.

To address growing demand for skilled personnel supporting overseas expansion, TPCA is actively promoting the Thailand PCB Academy

International Higher Talent Training Projects. It will also organize an International Talent Matching Day during TPCA Show on October 21, 2026.

Through practical cross-border talent development and industry–academia collaboration, TPCA aims to enhance the visibility of Taiwan’s PCB industry in Southeast Asia and establish a stronger foundation for long-term regional cooperation.