US semiconductor maker GlobalFoundries Inc. plans to build two chip manufacturing plants in Malta, New York, backed by an investment of up to $21 billion from Japan, the company said Wednesday.

GlobalFoundries said the deal was made possible by a trade and investment agreement between the Trump administration and the Japanese government. The investment is expected to speed up semiconductor production in the United States and strengthen critical supply chains.

The company had previously received some federal funding under a programme launched during the Biden administration to expand domestic chip production. However, following the Japanese investment, that federal funding will be redirected to other projects aimed at advancing semiconductor manufacturing, GlobalFoundries spokesperson Kenneth Craig said in an email.

President Donald Trump said on social media that the US government would receive shares in GlobalFoundries, similar to its investment in Intel Corp. The move would extend the administration's policy of acquiring ownership stakes in private companies.

In a statement, GlobalFoundries said about $10 billion of the investment would speed up construction of a chip factory scheduled to open in 2029. The remaining $10 billion would support the development of a second plant.

Demand for semiconductors has grown rapidly in recent years, driven by advances in artificial intelligence and the increasing need for computing power at data centres.

In July, Taiwan-based chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) announced plans to invest an additional $100 billion to expand its manufacturing capacity in the United States.

TSMC has also been expanding its chip manufacturing facilities in the US, Japan and Taiwan.