Chinese authorities should seize Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) if the US were to sanction Beijing in a similar way that it acted against Russia, a senior Chinese economist said in a transcript released yesterday.
“If the US and the West impose destructive sanctions on China like sanctions against Russia, we must recover Taiwan,” China Center for International Economic Exchanges Chen Wenling (陳文玲) said last month.
The research group is overseen by the National Development and Reform Commission, China’s top economic planning agency.
Photo: Cheng, I-hwa, Bloomberg
“Especially in the reconstruction of the industrial chain and supply chain, we must seize TSMC,” Chen said in a speech at an event hosted by the Chongyang Institute for Financial Studies at Renmin University, with the transcript posted online yesterday by the Guancha news Web site.
“They are speeding up the transfer to the US to build six factories there,” she said. “We must not let all the goals of the transfer be achieved.”
The comments are some of the most prominent so far showing how Taiwan’s chip industry is seen in Beijing as a key strategic asset in the intensifying rivalry between the world’s two largest economies.
TSMC is the world’s largest contract manufacturer of semiconductors, accounting for more than 50 percent of the global foundry market, which involves businesses purely making chips for other companies. Its customers include Apple Inc, which relies on Taiwanese chips for iPhones.
A TSMC representative declined to comment on Chen’s remarks.
Media reports have said that TSMC is to build six chip fabs in the US, but the company has announced just one so far. It has bought more land for possible construction.
It is unclear how the scenario Chen described would occur, given that the US and other nations only leveled harsh economic sanctions on Russia after it invaded Ukraine in February.
Chinese President Xi Jinping (習近平) has sought to achieve tech self-sufficiency and tapped his economic czar, Chinese Vice Premier Liu He (劉鶴), to shepherd a key initiative aimed at helping domestic chipmakers overcome US sanctions.
Those sanctions, which were initiated by the administration of former US president Donald Trump, are impeding longer-term efforts by chipmakers from migrating toward more advanced wafer fabrication technologies.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
PRESSURE EXPECTED: The appreciation of the NT dollar reflected expectations that Washington would press Taiwan to boost its currency against the US dollar, dealers said Taiwan’s export-oriented semiconductor and auto part manufacturers are expecting their margins to be affected by large foreign exchange losses as the New Taiwan dollar continued to appreciate sharply against the US dollar yesterday. Among major semiconductor manufacturers, ASE Technology Holding Co (日月光), the world’s largest integrated circuit (IC) packaging and testing services provider, said that whenever the NT dollar rises NT$1 against the greenback, its gross margin is cut by about 1.5 percent. The NT dollar traded as strong as NT$29.59 per US dollar before trimming gains to close NT$0.919, or 2.96 percent, higher at NT$30.145 yesterday in Taipei trading
RSS