If the plan to build Kuokuang Petrochemical Technology Co’s (國光石化) naphtha cracker plant in Taiwan is scrapped, it would have a positive influence on the nation’s economy in the long term, economists said yesterday.
Premier Wu Den-yih (吳敦義) said on Saturday that Kuokuang Petrochemical might seek an alternative location overseas for its proposed plant, after President Ma Ying-jeou (馬英九) said on Friday that the government would not support the construction of the company’s project in Changhua County.
GDP growth could fall by 2 percentage points if the plant’s construction in Taiwan is halted because domestic investment momentum could drop without the NT$900 billion (US$31.11 billion) two-phase project, not to mention the economic spin-off effects, the Ministry of Economic Affairs said last week.
However, Gordon Sun (孫明德), deputy director of the macroeconomic forecasting center at the Taiwan Institute of Economic Research (TIER, 台灣經濟研究院), said any negative impact on GDP growth could be compensated for with the government’s other -investment projects.
“If Kuokuang Petrochemical’s project is out, the government could come up with projects or construction in other industries and transfer the NT$900 billion investment to them, keeping up the momentum in domestic investment,” Sun said by telephone yesterday.
Furthermore, the ministry’s forecast that 2 percentage points could be shaved off GDP growth would be a long-term effect spread over five to eight years, not just one year, Sun said.
Liang Kuo-yuan (梁國源), president of the Polaris Research Institute (寶華綜合經濟研究院), said that any potential withdrawal of Kuokuang Petrochemical’s investment from Taiwan would only have a limited impact on GDP growth.
“External demand could be -impacted if the project is halted, but the benefits for the local natural environment and water quality could offset this negative impact, as the macroeconomics not only include GDP growth, but also the potential negative consequences brought about by the execution of the project,” Liang told the Taipei Times.
Diagee Shaw (蕭代基), president of the Chung-Hua Institution for Economic Research (中華經濟研究院), said the potential withdrawal of the project could inspire the government into thinking that the development of the petrochemical industry should focus on quality, not just quantity.
The government is now seeking to develop a value-added petrochemical industry, such as the production of optical coatings and upstream materials for solar energy and LED industries, Minister of Economic Affairs Shih Yen-shiang (施顏祥) told a media briefing on Saturday.
Sun agreed that Taiwan could develop a high-end petrochemical industry by applying its successful development experience in the development of its semiconductor foundry industry.
“We should let investments in low-value and high-contamination sectors be made overseas, while retaining the value-added sectors here,” Sun said.
The government should also consider transferring the budgeted funds for the Kuokuang project to bio-technology, tourism and other manufacturing industries with value-added components, compensating for any potential dip in GDP growth, should the project be withdrawn, Sun said.
Nvidia Corp’s demand for advanced packaging from Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) remains strong though the kind of technology it needs is changing, Nvidia CEO Jensen Huang (黃仁勳) said yesterday, after he was asked whether the company was cutting orders. Nvidia’s most advanced artificial intelligence (AI) chip, Blackwell, consists of multiple chips glued together using a complex chip-on-wafer-on-substrate (CoWoS) advanced packaging technology offered by TSMC, Nvidia’s main contract chipmaker. “As we move into Blackwell, we will use largely CoWoS-L. Of course, we’re still manufacturing Hopper, and Hopper will use CowoS-S. We will also transition the CoWoS-S capacity to CoWos-L,” Huang said
Nvidia Corp CEO Jensen Huang (黃仁勳) is expected to miss the inauguration of US president-elect Donald Trump on Monday, bucking a trend among high-profile US technology leaders. Huang is visiting East Asia this week, as he typically does around the time of the Lunar New Year, a person familiar with the situation said. He has never previously attended a US presidential inauguration, said the person, who asked not to be identified, because the plans have not been announced. That makes Nvidia an exception among the most valuable technology companies, most of which are sending cofounders or CEOs to the event. That includes
INDUSTRY LEADER: TSMC aims to continue outperforming the industry’s growth and makes 2025 another strong growth year, chairman and CEO C.C. Wei says Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), a major chip supplier to Nvidia Corp and Apple Inc, yesterday said it aims to grow revenue by about 25 percent this year, driven by robust demand for artificial intelligence (AI) chips. That means TSMC would continue to outpace the foundry industry’s 10 percent annual growth this year based on the chipmaker’s estimate. The chipmaker expects revenue from AI-related chips to double this year, extending a three-fold increase last year. The growth would quicken over the next five years at a compound annual growth rate of 45 percent, fueled by strong demand for the high-performance computing
TARIFF TRADE-OFF: Machinery exports to China dropped after Beijing ended its tariff reductions in June, while potential new tariffs fueled ‘front-loaded’ orders to the US The nation’s machinery exports to the US amounted to US$7.19 billion last year, surpassing the US$6.86 billion to China to become the largest export destination for the local machinery industry, the Taiwan Association of Machinery Industry (TAMI, 台灣機械公會) said in a report on Jan. 10. It came as some manufacturers brought forward or “front-loaded” US-bound shipments as required by customers ahead of potential tariffs imposed by the new US administration, the association said. During his campaign, US president-elect Donald Trump threatened tariffs of as high as 60 percent on Chinese goods and 10 percent to 20 percent on imports from other countries.
RSS