Taiwan also represents a large geostrategic stake for the industry with the presence of the founder TSMC, world leader in the production of the most advanced electronic chips.
Could the Semiconductor Shortage See Another Upswing? This is the implicit warning sent on July 31, 2022 by the head of TSMC (Taiwan Semiconductor Manufacturing Co) during an exchange with CNN. in the question? Growing tensions between China and the US over the Taiwan Strait and the island’s status.
The latest Chinese tensions over Taiwan stem from the tour that Nancy Pelosi, the Speaker of the United States House of Representatives, is currently undertaking in Asia. She has already been to Singapore and is now in Malaysia. She will also travel to South Korea and Japan. And in this program another phase is envisaged: Taiwan.
We have to go back to 1997 to find the visit of a President of the US House of Representatives to Taiwan. Since then, no official of such high rank had returned to the island, which is considered a rebel province by Beijing. Any contact between US representatives and island officials is therefore seen as interference and a violation of sovereignty.
TSMC factories that would go out of business
It is in this context that Mark Liu, the head of Taiwan, formulated his warnings. A military escalation between Taiwan and the Chinese mainland, but also with the United States, could put TSMC out of business and therefore have serious consequences internationally. The group would then no longer be able to function, e.g. in the event of an invasion.
TSMC is one of the most advanced semiconductor manufacturers in the world, along with South Korean Samsung and American Intel. These companies are now in the race for class 3 nanometer transistors and are able to supply the market with products with etch fineness of 5 and 7 nanometers.
No one knows if Nancy Pelosi will stop in Taiwan or, if this scenario occurs, how China will respond. We know that live ammunition drills have been announced near the Chinese coast, facing Taiwan, and we can expect incursions of Chinese aircraft near Taiwanese airspace, to put pressure on the defense of the island.
Without going as far as an invasion of the island, a highly unlikely prospect today, these tensions could give rise to a military slip-up due to a misjudgment on one side or the other. It is also to prevent an incident of this nature – such as a bombing of TSMC plant – that Mark Liu is speaking.
On a technological level, Taiwan has become a strategic hub in the production of semiconductors. China, like many countries, has significant needs in this area. And local companies have yet to achieve the same quality. The company Semiconductor Manufacturing International Corporation (SMIC) engraves in 14 nanometers.
By speaking thus, Mark Liu also seeks to warn that a seizure of power by Taiwan would have enormous local and international consequences, and that China’s gains in the event of victory would not be certain. According to Mark Liu, TSMC must be in constant contact with partners in Asia, Europe and the United States.
A takeover of TSMC by China would have the effect of putting the industrial production sites out of business. Shortly said, ” no one can control TSMC by force “Judge Mark Liu. China wouldn’t necessarily be able to get factories running again without these external links – but it could still get its hands on research and development.
It is not certain that the issue of supplying the world with electronic chips constitutes an audible argument for China to downgrade its claims on Taiwan. The obsession with a single and fully reunited China remains the main compass of power. What would happen to TSMC in such a case would certainly be random.