【2024 Semiconductor Forum】Economic Security and Semiconductor Cooperation: The Future of Taiwan-Japan Relations

Dr. Jeremy Chang of the DSET (phote: the DSET).

At a forum focused on global supply chains and economic security, experts recently delved into the collaboration and challenges between Taiwan and Japan in the semiconductor industry. Dr. Jeremy C. Chang, a speaker at the event, spent 15 years living in Japan and also worked within the Japanese government’s policy-making circles. He shared his insights into the prospects for economic security and supply chain restructuring between the two countries.

Dr. Chang talked about his background in law studies and teaching in Japan before joining a governmental policy group focused on economic security. During his return visit to Taiwan, he hoped to share his experiences in Japan and explore the potential for semiconductor industry cooperation between Taiwan and Japan.

In his speech, Dr. Chang highlighted the challenges and opportunities Japan and Taiwan face in reorganizing supply chains. In recent years, the Japanese government has heavily subsidized TSMC to support its setup of production facilities in Japan, aiming to rebuild Japan’s semiconductor industry competitiveness and secure its position in the global supply chain.

However, these subsidies have sparked some concerns. Dr. Chang pointed out that such support could lead to competition between Taiwan and Japan, particularly in attracting investments. Japanese policymakers also worry that Japan might become a mere processing hub for Taiwan’s exports, allowing foreign companies to leverage Japanese resources and advantages without providing sustained investment in return.

Another crucial issue is security. Dr. Chang noted that if Taiwan and Japan share semiconductor manufacturing capabilities, Taiwan’s national security could be undermined. If a crisis occurs in the Taiwan Strait, Taiwan might lose some of its bargaining power due to transferring part of its production capacity to Japan.

To address these challenges, Dr. Chang suggested that Taiwan and Japan should increase cooperation to balance economic and security interests. He also recommended that both sides engage in open discussions to ensure that cooperation is based on fairness and transparency.

This forum served as a platform for policymakers and industry experts to explore Taiwan-Japan semiconductor industry collaboration and future possibilities. Through cooperation, both countries can achieve mutual benefits and tackle the challenges brought on by the restructuring of the global supply chain.

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