Escalating trade tensions between Washington and Beijing will create tougher challenges for the global IC industry, said TSMC Chairman Mark Liu (劉德音), and he called for local players to make efforts to become more competitive to take on the headwinds.
Addressing an annual meeting of the Taiwan Semiconductor Industry Association (TSIA), which he chairs, Liu said the global economy is being hurt by United States-China trade friction and geopolitical tensions from Russia’s invasion of Ukraine, and Taiwan’s semiconductor sector will come under pressure.
The U.S. on Oct. 7 announced a new round of restrictions on exports of ICs and related production equipment to China, expanding their scope to semiconductors used in artificial intelligence and supercomputers.
They have been viewed as the most comprehensive sanctions against Beijing to date.
TSMC itself, however, may have avoided a direct hit to some extent.
It confirmed last week a report saying that it had secured a one-year license allowing its plant in Nanjing to continue ordering American chipmaking equipment, giving it a temporary reprieve from the sanctions.
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To protect Taiwan’s semiconductor sector as a whole from taking a hit, however, Liu urged Taiwan’s IC suppliers to make themselves more competitive, and he said his company, the world’s dominant contract chipmaker, was determined to support them.
To boost the industry’s competitive edge, Liu said, all TSIA members should continue to devise comprehensive Environment, Social and Governance (ESG) strategies to fight climate change and promote green manufacturing to cut carbon and support a circular economy.
At the same time, Liu urged the government to come up with a long-term policy to ensure sufficient supplies of water, electricity and land while protecting the environment to help the domestic semiconductor sector meet sustainability goals.
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Echoing Liu, Nicky Lu (盧超群), chairman of memory chip supplier Etron Technology, Inc., said the global semiconductor industry is expected to be affected by the latest trade sanctions imposed by the U.S. against China for about a year before recovering.
Liu expected IC suppliers and other industrial players not only in China but also in Taiwan, Japan and South Korea to fall victim to the latest trade sanctions.
Lu added semiconductor suppliers should invest more in research and development and make more innovative products to reduce the risks of trade friction.
TSMC’s Liu was clearly hoping that the industry can maintain its success of the past 12 months, in which Taiwan had the biggest pure-play wafer foundry sector and IC packaging and testing industry and the second biggest IC design sector.
According to the TSIA, the production value of the local semiconductor industry topped NT$4 trillion (US$125 billion) for the first time in 2021, and output in 2022 is expected to grow another 19.7 percent to NT$4.88 trillion.
Source: Focus Taiwan News Channel