Taiwan will not surrender its semiconductor supremacy
FROM the 1970s until a few years ago Taiwan’s semiconductor sector looked worthy but dull. Its chip-fabrication plants (fabs for short) kept the global electronics industry ticking, but it was the gadgets the chips went into that made headlines.
No longer. The world’s geopolitical heavyweights now regard microprocessors as powering not just all manner of machines but their economies as well. America is splurging $50bn in subsidies to bring chipmaking back home. Europe has similar plans, not least to reduce its dependence on Taiwan, which next-door China claims as part of its territory. Rapidus, a joint venture of Japanese electronics firms, aims to be mass-producing cutting-edge chips by 2027, just two years after TSMC, the Taiwanese chip champion, will start manufacturing similar silicon. Samsung of South Korea, TSMC’s main rival, hopes to begin churning out such chips in 2025. China, for its part, wants to build an independent chip industry that does not have to rely on imports of technology, which America is choking off.
The stakes for Taiwan are high. So long as everyone relies on the island for semiconductors, the thinking goes, not even China will up-end the geopolitical status quo. If chips are made elsewhere, this “silicon shield” turns brittle. More prosaically, the sector, with eight of the country’s ten best-paying companies, provides good jobs. Taiwanese chip firms also have reasons to keep production at home. Too much expansion abroad could weaken local research networks and make it easier for foreign firms to poach staff.
2023-10-12 09:04:45
Source from www.economist.com