Sunday, January 23, 2022

Mitigating the Trade-Off Risks of Taiwan’s Over-Reliance on its Semiconductor Industry

Recommendable! 

Other questions, the article below did not address: E.g. will Taiwan destroy its semiconductor industry if China invades?

"Taiwan’s growing reliance on its semiconductor industry as an asset and international diplomatic tool is widely heralded by strategists, economists, and business professionals alike. Yet, the country’s lack of export diversification, centralized prioritization of resources, and a sober expectation of long-term market dominance present a high-risk environment in which Taiwan is vulnerable to both endogenous and exogenous shocks. ...
For instance, Taiwan’s extended drought in the first half of 2021 placed severe pressure on both local and national water supplies. Government regulators had to incentivize farmers to skip this growing season and even to halt irrigation altogether in order to divert water to neighboring chip manufacturing processes. ...
The importance of the semiconductor industry in Taiwan is now internationally recognized—and for good reasons. Taiwan Semiconductor Manufacturing Company (TSMC) alone manufactures 84 percent of the world’s most advanced chips. ...
As of June 1 [2021], TSMC began construction on a USD $12 billion chip factory in Arizona, with plans to open for production in 2024. This project, however, remains one of the few tangible international partnerships at the company level within the Taiwanese semiconductor industry. ..."

Mitigating the Trade-Off Risks of Taiwan’s Over-Reliance on its Semiconductor Industry 

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