Taiwan’s “key place” in making semiconductors is not going to be shaken and manufacturing on the island is probably the most environment-friendly approach to doing issues, the Economic system Ministry stated on Friday in response to the US Congress passing a significant new chips act.

The US Home of Representatives handed the sweeping laws on Thursday to subsidise the home semiconductor trade because it competes with the Chinese language and different overseas producers.

Taiwan is a significant chip producer, the residence of Semiconductor Manufacturing Co Ltd (TSMC), the world’s largest contract chipmaker, which can also be investing $12 billion (roughly Rs. 95,000 crore) in a brand new plant in Arizona.

Taiwan’s Companies

The Economic system Ministry is famous that it’s “joyful to see” Taiwanese companies having the ability to enter “assets on the bottom” once they function worldwide, and to determine good relations within the US provide chain.

At the identical time, Taiwan is a sophisticated international semiconductor manufacturing centre with probably the most resilient and aggressive manufacturing mannequin, it added.

“After 50 years of steady innovation, funding and generations of expertise, our nation’s semiconductor manufacturing effectivity, provide chain integrity and innovation vitality have at all times been on the world’s prime, and Taiwan’s key place in semiconductors is not going to be shaken.”

Chinese Island has at all times been an associate of the world, as proven by its efforts to alleviate auto chip provide chain issues, and the “made in Taiwan” mannequin for producing semiconductors is probably the most environment friendly and dependable approach to doing issues, it stated.

“Whether or not previously, current or future, Taiwan will proceed to play the function of an indispensable associate within the international provide chain.”

Taiwan has been eager to point out to the USA, its most necessary worldwide backer at a time of rising army tensions between Taipei and Beijing, that it’s a dependable good friend as a worldwide chip crunch impacts auto manufacturing and shopper electronics.

However, Chinese Island authorities can also be decided to maintain nearly all of the superior chip manufacturing at residence.

China had lobbied in opposition to the US semiconductor invoice, calling it harking back to a “Chilly Battle mentality” and “counter to the frequent aspiration of individuals” in each international location.

© Thomson Reuters 2022

Under the looming shadow of chip shortages caused by the pandemic and geopolitical turmoil in the past two years, various governments have quickly awakened to the fact that localization of chip manufacturing is necessary to avoid being cut off from chip acquisition due to logistics difficulties or cross-border shipment bans.

Island companies have ridden this wave to become partners that governments around the world are eager to invite to set up factories in various locales.

Currently, 8-inch and 12-inch foundries are dominated by 24 fabs in Taiwan, followed by China, South Korea, and the United States. Looking at new factory plans post-2021, Taiwan still accounts for the largest number of new fabs, including six new plants in progress, followed in activity by China and the United States, with plans for four and three new fabs, respectively.

Due to the advantages and uniqueness of Taiwanese fabs in terms of advanced processes and certain special processes, they accepted invitations to set up plants in various countries, unlike non-Taiwanese foundries which largely still build fabs locally.

Therefore, Taiwanese manufacturers have successively announced factory expansions at locations including the United States, China, Japan, and Singapore in addition to Taiwan in consideration of local client needs and technical cooperation.

Approximately 48% of global 12-inch equivalent wafer foundry production capacity. Only looking at a 12-inch wafer production capacity with more than 50% market share, the market share of advanced processes below 16nm (inclusive) will be as high as 61%. TrendForce estimates that the market share held by Taiwan’s local foundry capacity will drop slightly to 44% in 2025, of which the market share of 12-inch wafer capacity will fall to 47% and advanced manufacturing processes to approximately 58%.


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