Fri, Jul 11, 2008 page1

• Ease chipmaker investment caps: Ma

  CHINA BOUND The president said that if the US was not afraid to allow its chipmakers to set up more advanced manufacturing facilities in China, Taiwan should not be either

  • By Mo Yan-chih and Jerry Lin / STAFF REPORTERS
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  President Ma Ying-jeou (馬英九) said yesterday that Taiwan should be more open and relax its rules on investment in China by Taiwanese chipmakers, noting that the US allowed Intel Corp to build a 12-inch factory in Dalian last year.

  “I believe that it is a reasonable and necessary policy for our government to open up further,” Ma said as he met Mike Splinter, president and chief executive officer of Applied Materials, a supplier of products and services to the semiconductor industry, at the Presidential Office.

  Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) and other chipmakers have been seeking to move more production to China to be closer to customers, but at present they are only allowed to set up 8-inch factories.

  Taiwan is “lagging behind” the US, as the government only allows chipmakers to produce 8-inch or smaller wafers in China and to use 0.18-micron or larger processes, Ma said. The government should ease controls as long as the move does not violate the spirit of the Wassenaar Arrangement on Export Control for Conventional Arms and Dual-Use Goods and Technologies, he said.

  The 1996 pact aims to ensure that transfers of these items do not contribute to the development or enhancement of military capabilities that undermine regional and international security and stability.

  If the US government, which was a key player in the pact, allowed Intel to set up a 12-inch factory, Taiwan should also relax its investment regulations on the semiconductor industry, Ma said.

  The Ministry of Economic Affairs (MOEA) held a press conference later yesterday to say it would incorporate Ma’s ideas next month as it relaxs restrictions on technology investment in China, after it completes its plan to remove the 40 percent cap on China-bound investment this month.

  “As long as we are able to control our key technologies, we can basically follow international standards,” Minister of Economic Affairs Yiin Chii-ming (尹啟銘) said.

  The Wassenaar Arrangement requires the technology during the production stage at Intel’s wafer plant in Dalian to be at least two generations behind the latest technology after it goes into mass production. For example, the US allowed Intel to set up a 12-inch wafer fab using 90 nanometer process technology in Dalian, as the latest technology in the US is 45 nanometer.

  After the Dalian wafer fab goes into the mass production stage, both 90 namometer and 65 nanometer process technologies will be allowed to be used in Dalian, as the latest technology will have advanced to 32 nanometer in the US by then.

  But even if the restrictions are lifted, Yiin said the possibility that Taiwanese semiconductor firms will invest in 12-inch wafer fabs in China is rather low, as China’s semiconductor industry is not as competitive or as complete as Taiwan’s.

  At a separate setting last night, Lin Chen-wei (林成蔚), director of the Democratic Progressive Party’s Department of International Affairs, urged Ma to do his homework and be more cautious when commenting on economic policies.

  “Talking through his hat without making a thorough assessment will only worsen the economic downturn and cause more disasters in the stock market,” Lin said.

  He said Ma was making an naive decision “based on the simple logic that the US allows chipmakers to invest in China, so Taiwan can too.”

  Such a policy would put Taiwan in a very dangerous situation, Lin said.

  Additional reporting by CNA and Staff writer
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