The nation's two largest chipmakers could face fines of up to NT$5 million if reports they have purchased plots of land in an industrial park near Shanghai turn out to be true, the vice chairman of the Mainland Affairs Council (MAC) said yesterday.
"If it is true ... then the law says that the penalty is between NT$3 million to NT$5 million," said John Deng (
Taiwan law currently bars local chipmakers from investing in China, though government officials are considering allowing companies to set up older technology chip plants capable of etching chips on 8-inch round silicon wafers.
According to local media reports, both Taiwan Semiconductor Manufacturing Co (TSMC,
Spokespeople at both companies declined to comment on the reports.
"Even if it is true, how do our laws see this? Generally speaking, the determination depends largely on whether they send the money," Deng said. While it is not illegal for a Taiwanese company to buy or rent land in China, it is against the law to dump capital into semiconductor factories there.
Deng also said an announcement on whether or not to allow local chipmakers to build plants in China is not expected soon.
"The whole Cabinet is currently being reshuffled, so ... I can't give you a date," Deng said.
Part of the trouble with allowing companies to build chip-making facilities in China is concern over the outflow of capital from Taiwan to China, Deng said. Technology is another issue.
Companies worldwide are barred from exporting high-tech chipmaking equipment to China due to the Wassenaar Arrangement -- an agreement reached among 33 nations including Japan, the US and most of Europe -- to ensure machinery useful to make both commercial and military products is kept out of the hands of rogue nations.
As the originator of the chip industry, the US takes the lead in the chip equipment industry. Deng said Taiwan will follow whatever rules the US lays down as far as technology exports to China is concerned, and may even maintain more stringent laws if it is deemed vital to Taiwan's interests.
Currently, technology chipmaking equipment which allows the etching of chips below the tiny 0.25 microns -- 1,000 times thinner than a human hair -- are barred from export to China.
US manufacturers are working to change this law in order to take advantage of the growing China market.
"China represents a huge potential market for semiconductor equipment that is predicted to grow from US$1 billion in 1999 to US$4 billion in 2003. In light of these factors, the Semiconductor Equipment and Materials International (SEMI) has a long history of pressing for free trade and open market access to all major markets for SEMI members," said a statement by SEMI, an industry group that represents more than 2,400 member companies whose combined sales average US$100 billion per year.
Taiwanese chipmakers are pressing to be allowed access to China so they can take advantage of a market that only produces 20 percent of the chips it needs. Production costs, including land, labor and utilities are also a factor -- in China they will be between 3 percent and 5 percent less expensive, according to Chris Hsieh, chip analyst at ING Barings.
Local chipmakers also fear being left behind. US-based Motorola Inc, Japan's NEC Corp and a Taiwanese entrepreneur have already set up chip plants in China. Semiconductor Manufacturing International Corp (
These companies hope to mop up China's excess demand and keep new market entrants at bay.
"We all see the benefits for the companies to invest in China," Deng said.
"Whether there will be a large capital outflow [from Taiwan and] how to take care of these technology issues" are questions officials in Taiwan are still wrestling with.
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
ADVERSARIES: The new list includes 11 entities in China and one in Taiwan, which is a local branch of Chinese cloud computing firm Inspur Group The US added dozens of entities to a trade blacklist on Tuesday, the US Department of Commerce said, in part to disrupt Beijing’s artificial intelligence (AI) and advanced computing capabilities. The action affects 80 entities from countries including China, the United Arab Emirates and Iran, with the commerce department citing their “activities contrary to US national security and foreign policy.” Those added to the “entity list” are restricted from obtaining US items and technologies without government authorization. “We will not allow adversaries to exploit American technology to bolster their own militaries and threaten American lives,” US Secretary of Commerce Howard Lutnick said. The entities
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
Minister of Finance Chuang Tsui-yun (莊翠雲) yesterday told lawmakers that she “would not speculate,” but a “response plan” has been prepared in case Taiwan is targeted by US President Donald Trump’s reciprocal tariffs, which are to be announced on Wednesday next week. The Trump administration, including US Secretary of the Treasury Scott Bessent, has said that much of the proposed reciprocal tariffs would focus on the 15 countries that have the highest trade surpluses with the US. Bessent has referred to those countries as the “dirty 15,” but has not named them. Last year, Taiwan’s US$73.9 billion trade surplus with the US
RSS