The semiconductor ecosystem in Taiwan cannot be replaced or copied, and has a complementary relationship with chip production in the US, American Institute in Taiwan Director Raymond Greene said.
Taiwan need not worry about the so-called “de-Taiwanization of semiconductors,” which some people have expressed concerns about since Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) began building fabs in the US, Greene said during an interview on the YouTube program Mindi World News aired yesterday.
Greene said that some people have misunderstood the industry relationship between the US and Taiwan, and that the industry is not a “zero-sum game.”
Photo: Bloomberg
“For example, someone may complain that semiconductors are manufactured in Taiwan and that there are few manufacturing plants in the US,” he said.
However, the US is still a world leader in chip design and machinery, and it is not disadvantageous to the US for chips to be manufactured in Taiwan, he said.
“Taiwan is small, but has a very strong supply chain and has advantages including industry talent, so this ecosystem cannot be copied or replaced,” he added.
Photo: Screen grab from Mindi World News’ YouTube channel
However, Taiwan alone cannot meet the increasing demand for semiconductors, especially the expanding demand for semiconductors for artificial intelligence (AI) applications, he said.
Taiwan faces restrictions in terms of land for fab development, electricity supply, labor and water resources, he said.
“What is more, many semiconductor customers require that green energy must be used,” he said, referring to RE100, a global initiative to demand that companies use 100 percent renewable energy for manufacturing.
While the high-end semiconductor industry would not leave Taiwan due to its many advantages, chip manufacturing must be done in more places to meet increasing demand, he said, adding that this was the motivation behind GlobalWafers Co’s (環球晶圓) investment in the US.
This is not because the US is trying to rope the company in, but because the company believes Taiwan’s manufacturing capacity is insufficient to meet demand, he said.
Regarding the issue of the US’ strict export controls, Greene said that China’s development of semiconductors is not to develop its economy, but to help the Chinese People’s Liberation Army build more capable missiles, which would threaten the US, Taiwan and allies.
“Therefore, the US is not focusing on the economy through these controls, but rather on national security,” he said.
“From this perspective, the interests of Taiwan and the US are 100 percent identical,” he added.
The situation could be viewed as an opportunity to strengthen high-tech industrial relations with Europe, Japan and other countries, he added.
Regarding how Taiwan should respond to China’s “gray zone” threats including cognitive operations, Greene said that Taiwan’s continual military reforms and the deployment of the US in the Pacific region are strengthening deterrence capabilities.
Therefore, the possibility of a full-scale war is quite low, but Taiwan should continue to voice its concerns about such threats to the world, he said.
Handling provocations from China requires caution and coordination to avoid misunderstandings that could lead to undesirable consequences, he said.
On the issue of the outcome of the US election, Greene said that regardless of who wins, Taiwan would continue to have cross-party support in the US, and that US policy toward the Asia-Pacific region would not change.
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