At Thursday's Cabinet meeting, the Ministry of Economic Affairs delivered a briefing on U.S. controls on Chinese semiconductors and Taiwan's response measures. After listening to perspectives and analyses from government departments and Taiwanese semiconductor industry representatives, Premier Su Tseng-chang said the relevant controls and export bans imposed by the U.S. would focus on high-end computing applications and semiconductor processing equipment, and would therefore have a limited impact on Taiwanese semiconductor firms. Nevertheless the nation should remain vigilant and the government is formulating response measures to enable domestic chip manufacturers to maintain their competitive edge and vital positions within the industry.
In addition to providing Taiwan-based semiconductor manufacturers with a high-quality investment environment, including the provision of water, electricity and land, Premier Su said that the government is also consulting with the industry to formulate a future development strategy, which will provide more generous tax incentives, encourage R&D investment and ease restrictions on talent recruitment. The government's comprehensive support of the domestic semiconductor industry will allow Taiwan to maintain its edge in the most advanced technology and efficient fabrication methods, secure a robust competitive advantage, and allow the nation to continue contributing to the world.
Premier Su emphasized that after four decades of dedicated efforts, Taiwan's semiconductor industry is not only essential for domestic economic development, but has also become a key force in global supply chains. Taiwan's contract chip manufacturing firms now hold a 63% share of the global market, and Taiwan firms handle 58% of global integrated circuit packaging and testing, ranking No. 1 worldwide in both fields. Taiwan also ranks No. 2 globally with a 22% market share in integrated circuit design. In addition, the domestic semiconductor industry is working with foreign partners to serve global clients, proving that the world's most efficient and difficult-to-duplicate production model makes Taiwan an essential and irreplaceable partner.
Three years ago, Taiwan took advantage of the U.S.-China trade war to persuade related industry operations to move from China to Taiwan, Premier Su said, giving rise to three ensuing years of economic success. The semiconductor export controls recently levied by the U.S. against China present both a challenge and an opportunity for Taiwan. Regardless of how the U.S.-China situation plays out in terms of national security or industry development, Taiwan will always stand on the right side alongside the international community, respecting international norms and soundly reassuring our allies. Taiwan will continue maintaining this stance as it moves forward, displaying our key strengths to the world and being a team player that inspires international confidence.
The premier also pointed out that, according to recent data from global indexes, Taiwan ranks among the top countries in the world on criteria such as investment environment and free democracy—even placing the nation among the best in Asia in many categories. These high marks instill further trust in our international partners.
Sources: Executive Yuan