Taiwan Vice Premier Dismisses US Semiconductor Relocation Demand

Taiwan's Vice Premier, Cheng Li-chiun, has firmly rejected a recent proposal from American officials to shift a significant portion of the island's semiconductor manufacturing capacity to the United States. In an interview with Taiwanese television channel CTS, Cheng described the demand as 'impossible', emphasising that Taiwan's robust semiconductor ecosystem is the result of decades of development.

The Vice Premier's comments were made in response to increasing pressure from US officials, including US Commerce Secretary Howard Lutnick, who has stated that the US must regain semiconductor manufacturing capabilities. Lutnick indicated a goal for the Biden administration to obtain a 40% market share in leading-edge semiconductor manufacturing, expressing concerns regarding the proximity of semiconductor production to China.

Cheng highlighted that the intricacies of Taiwan's semiconductor sector cannot simply be relocated. 'I have made it very clear to the United States that this is impossible,' she stated, referring specifically to the proposed target of relocating 40% of Taiwan's semiconductor production.

Despite rejecting the suggestion, Cheng reassured that Taiwan's semiconductor industry remains committed to growth and further investments within the country. She noted that while there are plans for international expansion, including investments in the United States, such endeavours will not overshadow the importance of domestic production. 'Our international expansion, including increased investment in the United States, is based on the premise that we remain firmly rooted in Taiwan and continue to expand investment at home,' she said.

Cheng's remarks come amidst a broader context where American officials are vocal about the necessity to bolster domestic semiconductor manufacturing in light of global supply chain vulnerabilities. Concerns have risen regarding the critical role that semiconductor chips play in various industries, from automotive to consumer electronics.

In addition to maintaining domestic production, Cheng also offered to share Taiwan's experiences in creating a successful technology cluster with the United States, though she reiterated that Taiwan’s established science parks would not be relocated. She expressed confidence that Taiwan's semiconductor capabilities would significantly surpass any investments made in the United States or other countries, reinforcing the notion that Taiwan will remain a key player in the global semiconductor industry.

As the discussion unfolds, the focus remains on how both nations can collaborate on semiconductor technology, ensuring resilience in a sector that is vital for technological advancement and economic stability worldwide.