Foxconn Technology Group is in talks with Saudi Arabia about jointly building a $9 billion facility that could make microchips, electric-vehicle components and other electronics, the Wall Street Journal reported.
Saudi Arabia is reviewing Foxconn’s offer to build a dual-line semiconductor contract manufacturing facility known as a “foundry” in Neom, a tech-focused city-state it is developing in the desert, the news report said.

Foxconn is the world’s largest contract electronics manufacturer and a major Apple supplier.

The company and other Taiwanese firms like TSMC, are looking to diversify their production amid U.S.-China trade tensions, which have impacted the semiconductor industry.

Besides Saudi Arabia, Foxconn is also talking with the United Arab Emirates about potentially situating the project there.

Riyadh wants the company to guarantee that it would direct at least two-thirds of the foundry’s production into Foxconn’s existing supply chain.