After US president-elect Joe Biden is sworn in, Taiwanese and international commentators agree that US-Chinese relations are likely to remain unchanged. That might be true, but there would be great differences in the force and scope of any confrontations. If the issue is not handled with caution, it could endanger not just Taiwan, but the world.
It took US President Donald Trump’s administration about three years to find China’s Achilles’ heel: It is technology, not trade. When the US imposed sanctions on Huawei Technologies during a US-China trade dispute, Huawei founder Ren Zhengfei (任正非) remained unfazed and continued to expand his business worldwide.
Once Washington issued restrictions on the Chinese telecom’s access to US technology, Ren begged for mercy. If Trump’s tech ban remains, it would delay Chinese technology development by 20 years.
After his victory, Biden is likely to be pressured by US companies to relax the restrictions for short-term commercial gains. If the US fails to protect trade secrets and stay alert for Chinese spies, technological innovations and job opportunities would be stolen by the Chinese.
Taiwan’s significance lies in the world-class Taiwan Semiconductor Manufacturing Co (TSMC) and the upper, mid and downstream sectors of its supply chain. If TSMC and related businesses are able to transform into an exclusive industrial cluster by cooperating with US, Japanese and European companies, that would create the a strong protective shield for Taiwan.
If Taiwan does not attach sufficient importance to the protection of intellectual property rights and prevent the flow of talent to China, it will be left with a bunch of outdated factories in 20 years.
Biden’s long political career shows that he avoids offending anyone. When former US president Barack Obama first took office nearly 12 years ago, he tolerated Beijing’s building of artificial islands in the South China Sea and did not send US warships to deter it.
Instead, Obama mobilized the Philippines to file a lawsuit against China with the International Court of Justice. The Philippines might have won the lawsuit, but China still occupies the South China Sea.
It is possible Biden will follow Obama’s approach. He might join hands with free democratic countries and place strong sanctions on China, but as a result of business pressure this is likely to be more talk than action. This could also accelerate China’s theft of technologies from the world’s advanced countries, and help it speed up its transformation.
Taiwanese businesses must understand that the Chinese Communist Party’s nature is that “if you cannot trick someone into giving you what you want, buy it; if you cannot buy it, steal it.”
These companies need to tighten control of their talent, and every key position must be accompanied with noncompetition agreements with specific time limitations.
Executives such as former TSMC research and development director Liang Mong-song (梁孟松), who left the firm for South Korea’s Samsung Group and then China’s Semiconductor Manufacturing International, should be prohibited from working for major competitors for at least 10 years after their resignation.
Taiwan’s chance to turn things around might lie in taking advantage of global anti-Chinese sentiment to recruit foreign talent, offering them job opportunities, permanent residency and quality healthcare insurance.
Using this approach, the nation could become a treasure island where global talent in high-tech industries would love to work, and where a leading semiconductor powerhouse acts as a critical strategic partner of Biden’s administration.
Richard Huang is Asia-Pacific general manager of US-based TRENDnet Inc.
Translated by Eddy Chang
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