News hour
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Sjoerd den Daas
correspondent China
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Sjoerd den Daas
correspondent China
It is also called the ‘silicon shield’; Taiwan’s status as a chip superpower. China and the West are so dependent on Taiwanese chips that the country sees it as life insurance against an invasion by rival China.
But its status as a chip superpower is under pressure now that Chinese access to Taiwanese chips has been restricted and Western countries are trying to reduce their dependence on Taiwanese chip ingenuity. How long will the chip save Taiwan?
Proud of the chip
On the campus of Tsing Hua University in Hsinchu, young Taiwanese are lining up to work for their country’s pride. “My parents both work in the semiconductor industry, so I was interested in it from an early age,” says Wu Hsuan.
Ch’en Chia-wei has already moved on for a number of years. “Most of my former classmates are already at TSMC,” he says. Taiwan produces about 90 percent of the most advanced chips in the world, the majority of which come from TSMC.
The young people do not have to worry much for the time being. The Taiwanese chip industry is eager for talent. But developments in the chip field are happening very quickly, partly because China is fully committed to it.
China wants to become self-sufficient
The neighboring country has invested hundreds of billions of euros in the industry in recent years. China is determined to become self-sufficient at all costs and is encouraged by this idea, among other things, due to the export restrictions on deliveries of advanced ASML machines from the Netherlands.
The backlog has not yet been caught up, but China is making progress, says Lin Ben-jeng. He is the former president of Taiwan’s TSMC. “As you build more chips, you run into more mistakes. That’s given them the opportunity to learn.”
At the same time, TSMC is forced to produce closer to its sales markets. As a result of the American Chips Act and the European chip regulation, intended to reduce dependencies, TSMC factories are now also being built in Dresden and Arizona. The red ribbon was cut last week for a new factory in Kumamoto, Japan.
If something happened to Taiwan, you wouldn’t be able to fix your cars.
Roy Chun Lee
The chip industry, led by TSMC, is seen as life insurance for Taiwan. In 2021 mentioned Taiwanese President Tsai Ing-wen is providing the industry with a shield against a Chinese invasion. Is that status now under pressure?
“I don’t think Xi Jinping is going to make the decision based on how many chips Taiwan produces,” said Roy Chun Lee. Until recently, he was deputy foreign minister and is now Taiwan’s de facto ambassador in Brussels. “We must diversify to maintain the confidence that we can always continue to deliver,” he explains the recent developments. “Now there are countries that are helping us with laws and subsidies to achieve exactly that goal.”
The focus of TSMC’s activities remains in Taiwan, but Lee believes there should be plenty of other reasons for allies to stand up for Taiwan. “It’s about much more than just the chips we produce, or whether we are a democratic country under threat,” says Lee. “If something were to happen to Taiwan, you wouldn’t be able to fix your cars. If your email server is down, you can’t fix it because there are no spare parts left.”
He says he does not see an acute military threat, but he does see daily intimidation. Reason to be prepared for anything. “For example, we are currently increasing our LNG reserves from seven to fourteen days,” says Lee. “Although I suspect that in the event of such a potential blockade, many factories will temporarily cease production. Moreover, I do not think that countries in other parts of the world would adhere to such a Chinese blockade.”
The Netherlands must realize that their economic and technological interests are directly intertwined with a potential conflict in the Taiwan Strait.
Roy Chun Lee
Help from America and Europe
Taiwan is dependent on the US for defense equipment, but Lee also looks explicitly to Europe. “I don’t think European countries, including the Dutch government, believe they are able to expand their aid militarily. However, we would like to see them do more to promote freedom of navigation in this part of the world .” So transits with naval ships in the Taiwan Strait.
That is in their own interest, Lee wants to emphasize once again. “European countries, including the Netherlands, must realize that their economic and technological interests are directly intertwined with a potential conflict in the Taiwan Strait,” said the top diplomat, who thinks Beijing still hopes to win the war without fighting. “But the best solution is to prevent that by making the price as high as possible for China.”
In August 2022, Nieuwsuur made this video about the Taiwanese chip industry:
2024-03-02 15:47:08
#Chips #Taiwans #life #insurance #China #long
