“Making us so indispensable that even China and the United States fear war over Taiwan”

Computers, telephones, cars, robotics, household appliances or the most modern medical equipment… semiconductors are everywhere. Over 70% of the world’s semiconductors are produced in Taiwan and the share even rises to 90% for the latest generation chips. In a tense geopolitical context, the semiconductor sector is logically at the center of strategic issues. Interview with Miin Wu, CEO and founder of Macronix, one of the major players in this sector in Taiwan.

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How can we explain Taiwan’s dominant position in global semiconductor manufacturing?

We have the skills and ability to mass-produce the highest quality chips at competitive prices. This field is of American origin, but large sums of money need to be invested in research, and production is expensive. It was once convenient to relocate this industry to Taiwan, an ally during the Cold War. The work culture there is not the same and we were ready to invest a lot of money. A “reverse brain drain” then occurred in the late 1980s with local talent returning to Taiwan after years abroad to develop the industry there and create low-cost, high-quality chips. Today we have the best engineers in the world who allow us to create new generations of semiconductors without increasing production or sales costs. We are working on 1 nanometer chips, it’s revolutionary. Without these skills and competitiveness we would not have survived.

This sector is sometimes described as the “Taiwan shield” against Chinese expansionist ambitions. Is that so?

I don’t agree with this expression. Certainly semiconductors are so important in our world that some might say there would be legitimate fear in attacking Taiwan for fear of targeting this sector. But on the other hand, it puts a target on our backs. This creates a scenario where Taiwan is so advanced in this industry that China may want to acquire it, by hook or by crook, because it would like to own our semiconductor manufacturing expertise. It would take charge of a sector that is doing well, on which the world depends, closing ten or twenty years behind our technology. This could be another reason for wanting to conquer Taiwan, even through war.

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You’re talking about war. What would the consequences be for the sector and the global economy?

The economy and research would take a leap back twenty years. The proportions would be much larger than in the case of the war between Russia and Ukraine over gas and oil, because here it would affect everyone. In the event of war, the semiconductor industry would pose a major problem. It could be specifically targeted by one or other of the belligerents, to oust the opponent. With factories destroyed and engineers killed or exiled, all our know-how in this industry would disappear. That would mean: no more new phones with the latest technology, no more new video game consoles, delays galore in building cars, no more cutting edge advances in technology, in medicine because all of its tools depend on semi-drivers. The entire society we live in would be turned upside down. And when the sector is regained control, the machines are restarted, knowledge is shared and a good pace of production and innovation is found, it will take ten to twenty years to catch up on the accumulated delay.

Many nations are aware of this and no one wants to take such risks. For reasons of national security, countries such as the United States, Japan or even those of the European Union want to produce semiconductors on their own territory in order not to depend on a sensitive area that can change at any time. But this is production for national security, not for access to the general public. They are not yet advanced enough for this.

Can your sector be an actor for peace in the region?

I hope we can be agents of peace. If we continue to develop the most advanced technologies, we will become so indispensable that even China and the United States will be afraid of a conflict over Taiwan, which would directly impact them. Because we must understand that semiconductors represent the next generation of development, it is the industrial revolution of the 21st century.

The elections in Taiwan are a very important issue. But whether it is against Beijing or in favor of rapprochement, the future government will act intelligently to avoid war, we are sure of it. What worries us most are the American elections at the end of the year, with the potential return to power of Donald Trump.

2024-01-13 06:04:00
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