At its September 19 board meeting, Taiwan's Central Bank emphasized Taiwan's critical role in maintaining its semiconductor dominance amid escalating US-China trade tensions in technology and national defense.
This point has been brought up in the reference material for the bank's ongoing seventh round of selective credit controls in the real estate market, including tightening loan-to-value ratios and grace periods.
As major nations push for semiconductor self-sufficiency, leading chipmakers such as TSMC have been courted to invest around the globe. The bank's report suggests Taiwan's well-established supply chain and cluster advantages remain difficult to replicate in the short term.
Photo: Governor of Taiwan's Central Bank Chin-Long Yang.
Credit: DIGITIMES
International collaboration is key
The Central Bank advised that, as a small, open economy deeply integrated with global markets, Taiwan should continue optimizing its investment environment to attract domestic and foreign companies to invest in advanced technologies. Furthermore, the bank recommended fostering cooperation with allied nations and enhancing communication mechanisms for economic and trade policies to maintain its leading position in the global supply chain.
In recent years, the US, European Union, and Japan have offered substantial subsidies to encourage TSMC to set up factories in their territories, underscoring the strategic value of the semiconductor industry.
Under President Ching-te Lai's "Five Trusted Industry Sectors" initiative, the semiconductor sector ranks at the top. The "Taiwan Chip-based Industrial Innovation Program" is set to implement various semiconductor projects over a decade with a budget of NT$300 billion(US$9.3 billion), an unprecedented investment in Taiwan's history.
According to government-approved policies, Taiwan will push for the localization of semiconductor equipment and materials. Related subsidy programs are expected to be introduced to production lines by the end of 2024, completing quality verification.
The plan's framework revolves around research,co-creation, and development. It will encourage companies like Nvidia, Micron, and AMD to invest in Taiwan's advanced technologies and collaborate with local industries on research and development.
In terms of international cooperation, semiconductor material and equipment companies from Japan, the US, and the Netherlands have already invested in Taiwan. Taiwan and the Netherlands will collaborate on the development of silicon photonics (SiPh), while cooperation with Lithuania will focus on laser technology.
Talent recruitment efforts
To expand its talent pool, Taiwan's first overseas chip innovation base in the Czech Republic has already begun operations. Additionally, Taiwan is implementing a customized international talent recruitment model, with 13 semiconductor companies and eight universities, including National Taiwan University, National Cheng Kung University, and National Tsing Hua University, traveling to Vietnam, Malaysia, and Indonesia to recruit talent.
Due to a shortage of semiconductor professionals, the Ministry of Education is encouraging universities and technical colleges to increase enrollment in fields related to semiconductors, AI, and mechanical engineering. In 2024, approved enrollment increases will total 6,355 slots, including 4,098 in universities and 2,257 in technical colleges.
The government is also focused on attracting more women to join the semiconductor industry as a key future priority.
