The partnership will begin with a review of Panama’s current semiconductor manufacturing capabilities, regulatory framework, and workforce and infrastructure needs.  

The organization said that it will not be able to begin manufacturing chips in 2024, as originally planned, due to a skilled worker shortage.

The U.S. Department of State said the two countries will explore opportunities to diversify and expand the global semiconductor market.

The U.S. and Europe will need to stimulate more innovation and reward manufacturers if they hope to loosen Asia's grip on the global semiconductor market.

To maximize product value and optimize revenue, manufacturers should leverage leading data to enable a proactive — rather than reactive — business strategy.

Foxconn said that the decision was a “mutual agreement,” but that it is still “confident” about the country’s semiconductor hopes.

A planned $200 million factory will reportedly be finished by January 2025 while construction on a different $46 million plant will be completed by October 2024.

The U.S. is also examining options for raw materials supply from Africa, but so far has only a few tentative plans, including preliminary cooperation agreements with the DRC and Zambia.

The announcement comes just days before a high-stakes trip to Beijing by U.S. Treasury Secretary Janet Yellen.

The Dutch government said that from September 1, the export of "certain advanced semiconductor manufacturing equipment" would have to be authorized.