Chipmaking plans spark protest

A demonstration organized by pro-Taiwan political and social groups will be held today in Taipei City to protest the lifting of the ban on Taiwanese companies investing in eight-inch chipmaking plants in China.

The march, organized by the Taiwan Association of University Professors (台教會) and the Taiwanese Engineers' Association (台灣工程師協會), will start at the Chiang Kai-shek Memorial Hall at 1pm and end in front of the Executive Yuan, where the groups will present a petition.

Organizers said thousands of the people are expected to participate in the event.

Chen I-shen (陳儀深), deputy director of the Taiwan Association of University Professors, stressed that march organizers are not against chipmakers going to China, but rather hope to convince the government to postpone the changes. He said demonstrators hope the march will ignite more in-depth discussion on the matter.

TSU lawmaker Chen Chien-ming (陳建銘) said "nothing would be left in Taiwan if the ban is relaxed now."

Hollowing out

"Taiwan will be left empty if [the government] gives away its eight-inch plants to China before it can build the 12-inch plants," Chen said.

Opponents of the ban's lifting argued that Taiwan should wait until the manufacturing of 12-inch wafers stabilizes before it approves the request by Taiwan Semiconductor Manufacturing Co (台基電, TSMC) and United Microelectronics Corp (聯電) -- the world's largest and second-largest contract chipmakers respectively -- to set up shop in China. A decision is expected by the end of March.

Critics said the successful rate for 12-inch wafer production is only 50 percent, while that of eight-inch wafers is 95 percent -- the highest in the world.

Economic worries

Chen said that relaxing the regulations would cripple Taiwan's economy, exacerbate unemployment and cause the country to lose its competitive edge by giving first-rate technology to China.

But according to TSMC Chairman Morris Chang (張忠謀), Taiwan-based companies must to go China to survive due to its gigantic market.

Chang found an ally in Vice President Annette Lu (呂秀蓮), who yesterday threw her support behind the government's preliminary decision to lift the ban.

Lu said she endorsed the Cabinet's explanation that some of the 23 eight-inch chip plants in Taiwan are already sitting idle.

"Based on the policy of `active opening, effective management,' I support the Cabinet's decision to permit the equipment of eight-inch chipmakers to go to China because some of these plants are idle," she said.

Cooperative effort

But Lu said that both the government and the companies have to work together to come up with measures to prevent high-tech business secrets from being stolen.

Reports Thursday said that a former manager of TSMC was suspected of having stolen trade secrets related to 12-inch wafer manufacturing and given them to a competing company in Shanghai.

Lu said that the US has been more willing to transfer high-technology to Taiwan than China -- which it considers a political rival.

She said Taiwan should be careful with its trade secrets and prevent them from being leaked to China because any leaks would affect the US' willingness to have its technology transferred to Taiwan.