South Africa Semiconductor Foundry Market: Local Manufacturing Growth, Capacity Expansion & Growth Outlook

According to IMARC Group's latest research publication, South Africa semiconductor foundry market size reached USD 608.16 Million in 2024. The market is projected to reach USD 846.34 Million by 2033, exhibiting a growth rate (CAGR) of 3.36% during 2025-2033.

How AI is Reshaping the Future of South Africa Semiconductor Foundry Market

• Acknowledging the importance of chips in AI, the National AI Strategy commits ZAR 70 billion to developing dedicated AI chips, accelerators, and memory devices, in order to increase local foundry capacity and ease collaborations with companies from leading global chip markets.
• Government efforts like the AI Institute of South Africa and research hubs in Cape Town and Johannesburg currently provide funding to foster AI innovation and talent, encourage semiconductor manufacturing investment, and advance high-performance applications.
• The communications market is the largest semiconductor end-use segment, accounting for more than 28% of the market. Rapidly growing AI applications and national government plans for 100-300 startups and 5,000 AI professionals drive foundry demand for AI applications and infrastructure such as servers and networking.

Get In-Depth 2026 Industry Insights & Projections

South Africa Semiconductor Foundry Market Trends & Drivers:

The local South Africa semiconductor foundry industry is expected to develop due to the presence of numerous critical minerals, including platinum group metals, tantalum and silicon-related elements, in the country used for the production of chips. To foster the local semiconductor industry, the government funds research centers such as the Microelectronics and Nanotechnology Centre at the CSIR. The shift into high-value processing is in line with national industrial beneficiation and economic diversification strategies, as well as with collaboration with foreign investors and inland STEM education in preparing a specialized local workforce to make South Africa a possible continental center for advanced manufacturing as global supply chains become less centralized.

The growing demand for power-efficient and application-specific semiconductors for use in renewable energy systems, electric vehicles and smart grid applications throughout the region will provide opportunities for semiconductor companies. The rapid rollout of renewable energy infrastructure, battery systems, microcontrollers and energy management units in South Africa has led to interest in a domestic foundry. Applications for electrification, advanced driver-assistance systems (ADAS), and autonomous driving in the automobile sector also dramatically increase the need for domestic chip manufacturing. Semiconductors for these applications will demand investments in node technologies and specialty nodes not only to supply the domestic industrials and green technology markets, but also to improve supply chain resilience and reduce domestic imports in an increasingly turbulent semiconductor market.

Geopolitical concerns and the global shift in semiconductor supply chains from Asian production hubs have caused such economies to seek further foundry investments in secondary markets. South Africa is considered a potential site as it has the right location, existing infrastructure, and open trade. Including, but not limited to, technology self-sufficiency programs, incubation centers, policies to increase the capture of value from its minerals, from potential synergies in assembly, test and, ultimately, manufacturing. These can also support digital transformation and position itself within Africa and the emerging international semiconductor ecosystem through conducive and coordinated policies.

South Africa Semiconductor Foundry Industry Segmentation:

The report has segmented the market into the following categories:

Technology Node Insights:

• 10/7/5nm
• 16/14nm
• 20nm
• 45/40nm
• Others

Foundry Type Insights:

• Pure Play Foundry
• IDMs

Application Insights:

• Communication
• Consumer Electronics
• Computer
• Automotive
• Others

Regional Insights:

• Gauteng
• KwaZulu-Natal
• Western Cape
• Mpumalanga
• Eastern Cape
• Others

Competitive Landscape:

The competitive landscape of the industry has also been examined along with the profiles of the key players.

Recent News and Developments in South Africa Semiconductor Foundry Market

• February 2025: ASP Isotopes commissions its Silicon-28 enrichment plant in Pretoria to improve local production of high-purity isotopes, supplying more of the regional chip ecosystem with the most advanced material required for state-of-the-art semiconductor substrates.
• March 2025: ASML adds additional installations of its EUV lithography systems to South Africa to support the development of sub-5nm technology at regional fabs and their partners, allowing for high-precision patterning in advanced applications across the region.
• June 2025: Government invests ZAR 1 trillion (US$62 billion) in infrastructure sector including new electronics assembly plants, increasing local semiconductor technology downstream integration and power management integrated circuits for renewable energy.
• 2025: Applied Materials introduces next-generation deposition and etch platforms designed to meet requirements for gate-all-around transistor (GAA) scaling, deployed in South African fabs to improve logic device yield and efficiency.
• 2025: Lam Research partners with local semiconductor manufacturers to implement advanced plasma etch and clean systems, improving defect control and process reliability in high-throughput semiconductor fabrication environments.

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