Small and medium enterprises make up the backbone of Taiwan’s economy, yet large corporations such as Taiwan Semiconductor Manufacturing Co (TSMC) play a crucial role in shaping its industrial structure, economic development and global standing.
The company reported a record net profit of NT$374.68 billion (US$11.41 billion) for the fourth quarter last year, a 57 percent year-on-year increase, with revenue reaching NT$868.46 billion, a 39 percent increase.
Taiwan’s GDP last year was about NT$24.62 trillion, according to the Directorate-General of Budget, Accounting and Statistics, meaning TSMC’s quarterly revenue alone accounted for about 3.5 percent of Taiwan’s GDP last year, with the company’s full-year revenue expected to represent an even higher share.
However, when considering actual GDP contribution (value-added impact) — excluding imported equipment and materials — the net effect is estimated to be about 5 or 6 percent.
Additionally, TSMC supports about 1,600 Taiwanese suppliers, highlighting its extensive economic footprint. While Taiwan’s N+1 policy aims to retain cutting-edge technology, overseas expansion might lead to talent outflow, impacting Taiwan’s long-term research and development capabilities.
On the economic front, Taiwan’s semiconductor industry output reached NT$4.3 trillion, accounting for 18 percent of GDP and contributing 60 percent of total exports, the Ministry of Economic Affairs has said.
TSMC aims to grow its revenue by more than 20 percent this year, driven primarily by surging artificial intelligence (AI)-related demand, with AI server and processor revenue expected to double, reaching 18 percent of total sales, as reported by the Wall Street Journal.
However, exports in traditional sectors would remain challenged by China’s real estate downturn and ongoing US-China tensions.
Geopolitically, the US$52.7 billion CHIPS Act aims to reduce the US’ reliance on Taiwanese semiconductors, potentially weakening Taiwan’s strategic leverage.
If TSMC expands globally, Taiwan’s “silicon shield” could be diminished, leading to less global attention to Taiwan’s security.
To navigate these challenges, Taiwan must safeguard its technological leadership, strengthen local research and development, and diversify its industries.
From a “silicon shield” to a “global TSMC,” Taiwan’s future would depend on how well it balances global expansion with domestic competitiveness.
Gary Chen is a former associate research fellow in the Department of International Affairs at the Taiwan Institute of Economic Research.
Yesterday’s recall and referendum votes garnered mixed results for the Chinese Nationalist Party (KMT). All seven of the KMT lawmakers up for a recall survived the vote, and by a convincing margin of, on average, 35 percent agreeing versus 65 percent disagreeing. However, the referendum sponsored by the KMT and the Taiwan People’s Party (TPP) on restarting the operation of the Ma-anshan Nuclear Power Plant in Pingtung County failed. Despite three times more “yes” votes than “no,” voter turnout fell short of the threshold. The nation needs energy stability, especially with the complex international security situation and significant challenges regarding
Most countries are commemorating the 80th anniversary of the end of World War II with condemnations of militarism and imperialism, and commemoration of the global catastrophe wrought by the war. On the other hand, China is to hold a military parade. According to China’s state-run Xinhua news agency, Beijing is conducting the military parade in Tiananmen Square on Sept. 3 to “mark the 80th anniversary of the end of World War II and the victory of the Chinese People’s War of Resistance Against Japanese Aggression.” However, during World War II, the People’s Republic of China (PRC) had not yet been established. It
Much like the first round on July 26, Saturday’s second wave of recall elections — this time targeting seven Chinese Nationalist Party (KMT) lawmakers — also failed. With all 31 KMT legislators who faced recall this summer secure in their posts, the mass recall campaign has come to an end. The outcome was unsurprising. Last month’s across-the-board defeats had already dealt a heavy blow to the morale of recall advocates and the ruling Democratic Progressive Party (DPP), while bolstering the confidence of the KMT and its ally the Taiwan People’s Party (TPP). It seemed a foregone conclusion that recalls would falter, as
A recent critique of former British prime minister Boris Johnson’s speech in Taiwan (“Invite ‘will-bes,’ not has-beens,” by Sasha B. Chhabra, Aug. 12, page 8) seriously misinterpreted his remarks, twisting them to fit a preconceived narrative. As a Taiwanese who witnessed his political rise and fall firsthand while living in the UK and was present for his speech in Taipei, I have a unique vantage point from which to say I think the critiques of his visit deliberately misinterpreted his words. By dwelling on his personal controversies, they obscured the real substance of his message. A clarification is needed to
RSS