US President Joe Biden signing the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act would have little bearing on individual countries’ advantages in the semiconductor industry, experts said at a forum yesterday.
Biden last month signed into law the act that includes about US$52 billion in funding to boost the US’ domestic semiconductor research and development.
The Legislative Yuan’s Digital Information and Governance Innovation Association, and Democratic Progressive Party Legislator Liu Shih-fang’s (劉世芳) office yesterday held a forum discussing the act’s effects on Taiwanese industry as well as geopolitics.
The semiconductor industry is a sector with a global division of labor: Taiwan specializes in manufacturing, and packaging and testing, the US focuses on design, and South Korea excels at computer memory units, said Chi Chao-yin (紀昭吟), deputy director of the Industry, Science and Technology International Strategy Center at the Industrial Technology Research Institute.
Ninety percent of Taiwan Semiconductor Manufacturing Co’s (TSMC) production takes place in Taiwan and it plans to set up new wafer fabs in Taiwan, the US and Japan, she said.
Expanding its manufacturing plants abroad can help TSMC further consolidate its highly competitive position, and promote cooperation between semiconductor industries in Taiwan and the US, Chi said.
The act stipulates that businesses sponsored by the US government cannot invest in China or other countries that are unfriendly to the US for 10 years, with the exception of manufacturing legacy semiconductors, 28-nanometer or larger chips, she said, adding that the act would only have a limited effect.
The US lacks the labor force to manufacture the number of wafers planned in the act, so it might recruit 3,500 high-tech workers from abroad, which means some of Taiwan’s semiconductor talent might move to the US, Chi said.
Chung-Hua Institution for Economic Research economist Roy Lee (李淳) said that the US aims to reshuffle the semiconductor supply chain by focusing on economic security and strategic autonomy, winning the strategic competition with China and maintaining the leading position in technologies and relevant regulations.
The US hopes to reduce its reliance on China and imports, and overcome its weakness in manufacturing as well as research and development, he said.
Taiwan’s semiconductor industry mainly provides original equipment manufacturing services and is in line with the interests of the US, which has a competitive relationship with South Korea, he said.
Taiwan should let the US accept that “Taiwan’s strengths are the US’ strengths, so empowering Taiwan is empowering the US,” he added.
Institute for National Defense and Security Research fellow Su Tzu-yun (蘇紫雲) said: “Taiwan should highlight its absolute advantages at the moment” as the world is reliant on Taiwan, but added that the nation has to be cautious and humble.
He likened the semiconductor industry to a Formula One race: Taiwan is an excellent driver, but the race cars are from the US and the chemical materials are from Japan, adding that without trust between these allies, Taiwan would be unable to maintain productivity.
Taiwan should nurture more talent and tighten security regulations on technology to maintain its position as one of the world leaders in the semiconductor industry, he said.
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