HONG KONG: Taiwan Semiconductor Manufacturing Co Ltd, the world's biggest contract chipmaker, said on Tuesday its board had approved an investment to set up a wholly-owned subsidiary in Arizona with a paid-in capital of $3.5 billion.

The investment is part of the plan that TSMC announced in May to build a $12 billion factory in Arizona, seen as an apparent win for the Trump administration's efforts to wrestle global tech supply chains back from China.

TSMC manufactures the bulk of its chips in Taiwan and has older chip facilities in China and the US state of Washington.

The company has said constructing the Arizona facility would start in 2021 with production targeted to begin in 2024 and that it would be able to process up to 20,000 silicon wafers per month.