The legislature’s Economics Committee reached a resolution yesterday that the National Development Fund (NDF) should not use its additional investment allocation of NT$33 billion (US$1.02 billion) for next year to pay for the restructuring of the dynamic random access memory (DRAM) industry.
Council for Economic Planning and Development Chairman Tsai Hsung-hsiung (蔡勳雄) said that under the existing constitutional system, he respected the committee’s resolution, but the council’s role was to act in line with Ministry of Economic Affairs policy.
Tsai said any decision to invest NDF money in Taiwan Memory Co (TMC, 台灣創新記憶體公司), which was set up to restructure the DRAM industry, hinges on two prerequisites: TMC and Japan’s Elpida Memory Inc must first sign a technology licensing agreement and they must form a cross-shareholding alliance.
The Executive Yuan conditionally approved TMC’s request for NT$8.1 billion from the fund, with NT$4.9 billion in the first stage and NT$3.2 billion in the second stage, the ministry announced a few days ago.
However, in recent weeks legislators across party lines have said the fund should not invest in TMC because DRAM prices have recovered, boosting the industry, and so there was no longer any need to proceed with the restructuring plan.
Taiwan’s DRAM industry has been bleeding money over the past two years because of overcapacity and a slump in demand.
The nation boasts six of the world’s top 10 DRAM manufacturers, but these hold a global market share of only 15 percent.
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