Sun, Jun 29, 2025 page8

• The rise of Taiwan’s chip industry

  • By Lin Tzu-yao 林子堯
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  The recently released A Chip Odyssey (造山者-世紀的賭注) is more than just a documentary. It is a timely reflection on Taiwan’s industrial journey and the evolution of its national identity. At a time when Taiwan faces growing geopolitical tensions, this film reminds the public of the long, uncertain climb that led to the nation’s semiconductor leadership.

  Unlike typical media portrayals that reduce this complex story to political catchphrases or simplified hero narratives, the documentary offers a more nuanced and grounded perspective. It shows that Taiwan’s rise in the semiconductor world was not a miraculous leap, but the result of trial and error, a series of policy experiments, and the quiet dedication of countless people. Most importantly, it is a story from which a deep and enduring sense of national confidence must grow.

  Mainstream accounts often spotlight a small number of visionary elites or senior bureaucrats, but this film illustrates that Taiwan’s semiconductor development cannot be credited to just a few individuals.

  The journey to semiconductor success was far from linear. For example, take the often-cited “breakfast shop” story.

  Many portray it as a chance meeting in a modest eatery. In fact, that shop was part of a state-run enterprise under the Veterans Affairs Council. It was a semi-official gathering place, regularly used by former president Chiang Ching-kuo (蔣經國) to hold meetings. It was in such spaces that some of Taiwan’s most important industrial decisions, including the push into semiconductors, were made. From the beginning, this was not a private venture, but a state-led project grounded in national planning.

  Taiwan’s industrial trajectory in the 1980s followed what political economist Chalmers Johnson described as the “developmental state” model. Like Japan, South Korea and Singapore, Taiwan deployed targeted state intervention to steer economic development.

  At the time, there was no certainty that semiconductors would prove to be the right choice. In its early phase, Taiwan sent engineers to the US to study manufacturing processes at RCA Corp. Contrary to expectations, the American trainers were not elite experts, but more akin to assembly-line technicians, many of whom had little formal education in electronics.

  Meanwhile, Taiwan’s delegates were top graduates from the country’s best universities, some holding master’s or doctoral degrees from the US. While Taiwan clearly had the talent, it was entering a sector where the technological and commercial barriers to entry were daunting.

  A pivotal moment came when Taiwan Semiconductor Manufacturing Co (TSMC) founder Morris Chang (張忠謀), a seasoned executive who had led divisions at Texas Instruments and General Instrument, agreed to take up a leadership role in Taiwan. His move was the result of years of outreach by Taiwan’s senior technocrats, particularly former minister of finance Li Kwoh-ting (李國鼎, also known as K.T. Li), who prioritized attracting foreign-born ethnic Chinese leaders with international experience.

  In a 1985 policy briefing to the Executive Yuan, even Chang described Taiwan’s entry into the semiconductor industry as a risky bet. However, from today’s vantage point, it is clear that the gamble paid off. Not only did Taiwan succeed, but it also created a global giant that now shapes international supply chains and national security strategies.

  The origins of TSMC remain a subject of political and academic debate. For years, the company’s story has been simplified, distorted or used for partisan purposes. A Chip Odyssey, with more than 80 interview subjects, provides clarity. It makes one thing evident: The success of Taiwan’s semiconductor industry was not built solely by visionaries or foreign expertise. It was the product of collaboration across sectors, skill levels and generations. Engineers alone could not have achieved this outcome without the support of capable technicians, factory workers and robust infrastructure.

  In today’s democratic Taiwan, the level of state support for semiconductors is stronger than ever. TSMC operates fabrication facilities in seven counties and cities, from Taoyuan and Hsinchu in the north to Tainan and Kaohsiung in the south. This nationwide presence reflects not favoritism, but a strategy of balanced development. The state plays an active role in providing land, power and water.

  None of this would be possible without government coordination. The question facing Taiwan now is not whether it can produce another TSMC, but whether it has the confidence and unity to protect what it has already built, particularly as regional tensions intensify.

  National confidence matters. For much of its modern history, Taiwan struggled for international recognition. Today, its semiconductor industry strength gives it a seat at the world’s most important tables.

  TSMC does not merely attend economic forums; it helps shape them. The company’s expansion into Japan prompted a visit from then-Japanese prime minister Fumio Kishida. Its global footprint opens doors at the White House and brings world leaders to Taiwan’s Presidential Office. This is not the profile of a follower, but a leader. Taiwan should internalize this role and have confidence in its capacity to shape the future.

  Chang once recalled that when he first proposed branding Taiwan’s chip industry in the late 1980s, government officials reacted with skepticism. They doubted the nation had what it took to lead. Today, that vision has not only been realized, but it has been embraced globally.

  Taiwan’s semiconductor mountain was not built by one man or one agency. It was a collective achievement, but like any summit, it remains vulnerable. If political actors distort the industry’s legacy or align with adversarial narratives, the risks are real. What has been built can be undone.

  Taiwan should respond with resolve. By continuing to invest in innovation, supporting talent and reinforcing public confidence, it can ensure that the “sacred mountain that protects the country” remains not just standing, but unshakable, and from that summit, it can climb even higher.

  Lin Tzu-yao is a doctoral student at National Taiwan University’s Department of Political Science.
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