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Caught in China-US trade war, Taiwan offers support to chipmakers

Credit: REUTERS/TYRONE SIU

Taiwan President Tsai Ing-wen promised on Thursday to help the island's key semiconductor industry overcome difficulties and consolidate its leading position, offering support to a sector increasingly caught up in China-U.S. trade tensions.

TAIPEI, Sept 24 (Reuters) - Taiwan President Tsai Ing-wen promised on Thursday to help the island's key semiconductor industry overcome difficulties and consolidate its leading position, offering support to a sector increasingly caught up in China-U.S. trade tensions.

Companies such as the world's biggest contract chipmaker, Taiwan Semiconductor Manufacturing Co Ltd 2330.TW, are major suppliers to the likes of Apple Inc AAPL.O and Qualcomm Inc QCOM.O, as well as Chinese firms like Huawei Technologies Co Ltd HWT.UL.

In July, TSMC said it had stopped taking new orders from Huawei in May and did not plan to ship wafers after Sept. 15, responding to U.S. curbs on supplying the Chinese company, which the Trump administration views as a security threat.

China, for its part, is trying to nurture tech champions of its own, such as SMIC 0981.HK, its biggest chipmaker, and wean itself off reliance on U.S. suppliers.

Taiwan's chipmakers were a crucial part of the global supply chain, Tsaid told a meeting of semiconductor company representatives in Taipei, including TSMC Chairman Mark Liu.

"We attach great importance to this strategic industry, and will actively assist the industry in solving problems, to continue to consolidate the advantages of Taiwan's semiconductor industry, and to accelerate transformation and development," the presidential office cited Tsai as saying.

Turning Taiwan into an advanced semiconductor processing centre is a key government effort, she added.

"The focus of future development includes localisation of material supplies, technology autonomy, localisation of foreign equipment manufacturing, and localisation of advanced assembly equipment."

The policies will be adopted one by one, to ensure "more abundant technical energy" for the industry and a complete industrial supply chain to enhance its key global role, she added.

Tsai hoped the joint efforts of the government and the private sector would boost the competitiveness of the industry in Taiwan, so that it can be a global bellwether.

On Wednesday, TSMC's Liu said the deleveraging of China-U.S. supply chains and protectionism on both sides of the Pacific would only drive up costs and limit the flow of ideas.

(Reporting by Ben Blanchard; Editing by Clarence Fernandez)

((ben.blanchard@thomsonreuters.com;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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