Localization of semiconductors is also globalization Taiwan’s three major advantages are difficult to replicate | Taiwan Semiconductor | De-Taiwanization | TSMC

Localization of semiconductors is also globalization Taiwan’s three major advantages are difficult to replicate | Taiwan Semiconductor | De-Taiwanization | TSMC
Localization of semiconductors is also globalization Taiwan’s three major advantages are difficult to replicate | Taiwan Semiconductor | De-Taiwanization | TSMC

[The Epoch Times, November 24, 2022]Whether semiconductors are “de-Taiwanized” has aroused concern. Wang Meihua, Minister of Economic Affairs of the Republic of China, emphasized that Taiwan has three major advantages after 40 years of development. This is the main reason why Taiwan has formed a complete system that is difficult for other countries to replicate. niche.

Factors such as broken supply chains, chip shortages, and geopolitical conflicts caused by the COVID-19 (CCP virus) epidemic have pushed Taiwan’s semiconductor industry to the forefront of history. The United States, Japan and other countries have invited TSMC and other major manufacturers to set up factories and build Production capacity, but it has caused concerns about the “de-Taiwanization” of semiconductors.

Wang Meihua accepted an exclusive interview with Central News Agency on the 23rd and said that TSMC will be invited to set up a factory in the United States because most of its customers are from the United States, so it must be close to customer needs, and more importantly, it must meet the needs of the US government for local production and risk reduction. Localization is not TSMC’s globalization.”

She emphasized that after more than 40 years of development, Taiwan’s semiconductor industry chain has formed a complete ecosystem covering front-end design, back-end manufacturing, equipment, and materials. This supply chain system cannot be completed by a single country or company alone.

For Taiwan’s semiconductor advantages, Wang Meihua analyzes that there are three main niches, namely, the development of a complete and dense supply chain system in the past 40 years, first-class science and engineering talents who are willing to enter the factory, and trust relationships that value intellectual property and business secrets.

In terms of a complete supply chain system, Wang Meihua said that Taiwanese factories focus on OEM. After cooperation between design companies in other countries and Taiwanese factories, they can mutually strengthen and improve each other, forming a good business model. This also drives Taiwan’s overall manufacturing supply chain to form a dense and complete upstream, midstream and downstream supply chain system.

Not only that, because Taiwan is making progress in the field of semiconductor manufacturing, it has attracted international semiconductor equipment and material manufacturers to set up R&D and assembly centers in Taiwan and supply them nearby. Therefore, it is difficult to form a complete supply chain system like Taiwan in other countries. “.

In terms of talents, Wang Meihua pointed out that Taiwan and the United States have a clear division of labor in semiconductors. Taiwan has always attached great importance to technological development and has a sufficient number of scientific and technological talents. The scientific and technological talents in the United States are usually engaged in software design, and the manufacturing field is an important industry tradition in Taiwan.

Not only that, Wang Meihua said that due to different national conditions, Taiwan’s first-class high-tech talents are more willing to work in factories than advanced countries such as the United States and Japan. The efficiency of using high-level manpower and low-level manpower to manage the production line is much lower, because the semiconductor manufacturing process is comparable. It is complex, with thousands of procedures, and once a problem occurs, it can be debugged at the fastest speed, thus forming an efficient and complete manufacturing chain.

Finally, there is the relationship of trust with customers. Wang Meihua said that because Taiwan focuses on semiconductor manufacturing, but South Korea’s Samsung and other major manufacturers have both design and manufacturing, if customers come to Taiwan, they don’t have to worry about whether their chip designs may be used as “references.”

In addition, Taiwan attaches great importance to the protection of integrity, intellectual property rights, and business secrets. In addition, it has established a deep trust relationship with international manufacturers through years of close cooperation. International manufacturers dare not set up R&D centers in China. The difference lies in “trust”, which may sound at first glance. Nothing, but Taiwan has established its industrial and cultural advantages over the past 30 to 40 years.

Regarding the outside world’s concerns about whether TSMC’s investment in 3 and 5 nanometer factories in the United States will repeat the history of Japan being replaced by Taiwan and South Korea. Wang Meihua explained that the cases of Taiwan and Japan are very different, because IC design profits in the semiconductor industry are the highest, accounting for about 60%, while manufacturing profits are less than 20%. The United States is the leader in IC design, while Taiwan focuses on manufacturing. It is a cooperative rather than a competitive relationship.

Wang Meihua said that if customers can stably manufacture semiconductors in Taiwan, Taiwan factories can also obtain reasonable profits, and Taiwan will continue to play this role well. In addition, Taiwan attaches great importance to technological development and the manufacturing field, which will also allow Taiwan’s semiconductor manufacturing. Sustained and stable development.

Regarding TSMC’s recent move of 3nm process or personnel to the United States, will it weaken Taiwan’s advantages. Wang Meihua believes that all countries today are aware of the importance of chips, so from the perspective of security, they will consider whether they can achieve local semiconductor manufacturing or cooperate with allies. TSMC has its own needs to set up factories in order to cooperate with major customers in the United States and Japan, as well as the country’s policies. But on the other hand, if TSMC sets up factories in various countries, it is localized for the local area, but for TSMC or Taiwan, why not? Not globalization and global layout.

Wang Meihua went on to say that due to the lack of semiconductor industry talents similar to Taiwan in various countries, some talents must go to the local area to assist TSMC in setting up factories. Going out with branches and leaves will help enhance Taiwan’s international influence.

Regarding the discussion of de-Taiwanization, Wang Meihua once again emphasized that “Taiwanese really want to unite.” Taiwan should let the whole world know how much the stability of the Taiwan Strait will affect the global economy and politics. If Taiwan is subjected to military attacks, blockades and other non-peaceful treatment, The disaster caused to the whole world will be far worse than the war between Russia and Ukraine.

Wang Meihua does not deny that political risks in the Taiwan Strait will be one of the considerations for corporate risk assessment, “But North Korea often launches missiles, and South Korea also has geopolitical risks.” She said that Taiwan needs to let international and foreign businessmen understand that investing in Taiwan can not only ensure profitability and stability, but also enable the company to continue to grow, which will greatly help the country’s industrial development.

(Central News Agency)

Responsible editor: Zhong Yuan#

The article is in Chinese

Tags: Localization semiconductors globalization Taiwans major advantages difficult replicate Taiwan Semiconductor DeTaiwanization TSMC