Minister of Economic Affairs Shih Yen-shiang (施顏祥) is scheduled to deliver a report at the legislature’s Economics Committee today, aiming to secure lawmakers’ support for a government plan to help restructure the nation’s troubled dynamic random access memory (DRAM) chipmaking industry.
This could be the last chance for the government to gain legislative approval to inject funds into newly established Taiwan Memory Co (TMC, 台灣創新記憶體公司), after the committee passed a resolution on Nov. 11 instructing the government to abandon its DRAM restructuring plan.
“Shih will deliver a report at the Legislative Yuan on Monday about the government’s plan to invest in TMC and will also take advantage of the opportunity to brief lawmakers on the rationale for a DRAM sector overhaul,” Deputy Minister of Economic Affairs Hwang Jung-chiou (黃重球) said on Friday.
Taiwan’s DRAM industry has been bleeding money over the past two years because of overcapacity and slumping demand. It boasts six of the world’s top 10 DRAM manufacturers but holds a global market share of only 15 percent.
To help local chipmakers obtain core technologies and expand market share in the face of heavy competition from South Korean companies, the government devised the TMC project earlier this year, under which the government would pool the resources of local DRAM companies and their foreign technology partners to develop more sophisticated DRAM technologies.
The Economics Committee, however, passed a resolution on Nov. 11 demanding that the government give up its TMC investment project and the DRAM industry restructuring plan.
Lawmakers said the government should not use taxpayer money to bail out private chip companies because the industry’s prospects have improved amid a rebound in DRAM prices.
The committee’s resolution came just a day after the ministry approved TMC’s application for a capital injection of NT$4.9 billion (US$148.5 million) on the condition that the company dedicate itself to developing innovative DRAM technologies in cooperation with foreign partners.
“As the legislative committee’s resolution has yet to clear the legislative floor, Shih will seek lawmakers’ understanding on the rationale for the TMC-centered DRAM industry restructuring plan,” Hwang said. “Minister Shih will court legislative support for the TMC investment plan in his report on Monday.”
Japan’s Elpida Memory, the world’s third-largest DRAM supplier, has agreed to invest in TMC and has teamed up with three Taiwanese DRAM makers.
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