Premier Yu Shyi-kun said yesterday that the government is "working toward" allowing local chipmakers to set up plants in China under the principle of "effective management," but it is still pondering when to lift the ban.
Yu added that the government would not be deterred by protests be staged today by the Taiwan Solidarity Union and the Taiwan Association of University Professors.
Earlier yesterday, the Mainland Affairs Council (MAC) announced that draft regulations intended to govern investment in eight-inch chip foundries in China would be published by the end of the month.
"The government favors a liberal approach, though more evaluation is necessary," Yu said, responding to questions raised by lawmakers during interpellation yesterday.
The country's two largest chipmakers, Taiwan Semiconductor Manufacturing Co (台積電) and United Microelectronics Corp (聯電), have applied for permission to build eight-inch wafer foundries in China.
"I cannot be too cautious on the matter in light of the weight it carries," Yu told lawmakers. "The key lies in whether the government can effectively oversee cross-strait trade."
The premier said that the government would likely impose conditions for migration to China by chipmakers, one of which would be a requirement that they build 12-inch wafer foundries in Taiwan.
Yu said the government would also expect local chipmakers to leave their research and development crews in Taiwan to keep the country's competitive advantage.
"The `no haste, be patient' policy has proven ineffective," Yu said, reaffirming the Cabinet's resolve to ease control on China-bound investment as advised by last year's Economic Development Advisory Conference.
He described the migration of chipmakers across the Strait as "a matter of when" and said that he believed there should be restrictions on the pace and magnitude of the migration.
The premier also begged lawmakers and the business community to give him more time rather than expect him to make an immediate decision on the thorny issue, saying that he had been in office for less than two months.
Earlier yesterday, MAC Vice Chairman Chen Ming-tong (陳明通) said draft regulations governing eight-inch chip investment in China are almost complete and will be ready for publication by the end of this month.
Chen said the MAC is refining "effective management" regulations to control China-bound eight-inch wafer plants. "We will finish our position paper and release it to the public by the end of March," Chen said.
"The regulations must reflect the reality of the situation, ensure that companies investing in China do so as part of a global investment strategy and encourage the flow of capital back to Taiwan," Chen said.
The MAC official also said the government will continue to promote the upgrading of Taiwanese industry.
Currently, there are 23 eight-inch wafer fabs in Taiwan.
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Chipmaking plans spark protest