【2024 Semiconductor Forum】Taiwan’s Semiconductor Industry and Economic Security: Balancing Challenges and Opportunities

Researcher Min-yen Chiang of the DSET (phote: the DSET).

During a recent forum, experts discussed Taiwan’s challenges and opportunities in safeguarding its economic security while protecting its semiconductor industry. Chiang shared insights on Taiwan’s approach to semiconductor technology protection and geopolitical considerations, illustrating how Taiwan aims to secure its interests in a globalized context.

Chiang’s perspectives are grounded in his research on Taiwan’s semiconductor industry and conversations with industry leaders. He noted that Hong Kong’s recent developments have significantly impacted many Taiwanese, leading to concerns about Taiwan’s sovereignty and economic security. These concerns have prompted Taiwan to review its legal and regulatory framework to ensure that semiconductor technology does not end up in the hands of those who shouldn’t have it.

Taiwan’s semiconductor industry plays a crucial role in the global supply chain, making it essential to protect the industry from external threats. Chiang described Taiwan’s legal and regulatory framework, including internal investment reviews, technology collaboration assessments, and export licensing systems. He emphasized that Taiwan imposes stringent scrutiny on investments from China to prevent Chinese government infiltration of Taiwanese industries.

Chiang mentioned that one of the significant challenges Taiwan faces in ensuring economic security is China’s “remote poaching model.” This approach allows China to hire engineers in Taiwan and then transfer R&D resources back to China, posing a threat to Taiwan’s semiconductor industry. The Taiwanese government must strengthen regulations and increase investigations into illegal activities to combat this.

However, Chiang pointed out that Taiwan’s economic security encompasses technology, investment reviews, and broader geopolitical issues. China’s military threats and reunification intentions pose significant risks to Taiwan’s economic security. Therefore, Taiwan must collaborate with other democratic nations to establish a multilateral framework to ensure economic security and technology protection.

Chiang made three recommendations in his speech: first, to create a multilateral framework for economic security to ensure fair and reasonable international cooperation; second, to establish an economic network to counter China’s economic strategies; third, to emphasize comprehensive security, including global collaboration to prevent China’s military and political threats.

The forum underscored Taiwan’s importance in protecting its semiconductor industry and ensuring economic security. Through multilateral cooperation and robust regulatory frameworks, Taiwan can maintain its competitiveness in the global supply chain while ensuring its own safety and stability.

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