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>That is a huge win for them and makes the Chinese mainland threat to assimilate Taiwan less? More fab capacity is a win. No the opposite, TW is giving up thei

>That is a huge win for them and makes the Chinese mainland threat to assimilate Taiwan less? More fab capacity is a win. No the opposite, TW is giving up their silicon shield due to pressure from various blocs. The chief global interest in defending TW evaporates and PRC calculus for reunification increases when enough critical semi productions moves off island. DPP / TW has been balancing a tight rope of placating demands for TSMC fabs outside of east asia and trying to trade it for some geopolitical wins. But really TSMC and TW has no choice, EU/US/JP all have sticks like tech sanctions of supply chains TSMC relies on, the carrots of subsidies and temporary positive geopolitical messaging around TW recently are consolation prizes. I think TW hopes naively if they spread TSMC supply chain in enough countries, it would increase mutual dependancy and security. Instead, in scenario of PRC reunifying forcefully, host countries will just nationalize TSMC fabs on their soil. The entire point of TW's silicon shield is to concentrate fabs on TW to sustain uneasy detente. The more production moves off island the more opportunities for global demand to factor out TW fabs... which unlike Japan, Korea, NATO countries where new fabs are being proposed, explicitly does not have US security guarantee, i.e. TW fabs will become the most vunerable suppliers. This point is key. For PRC, having critical fabs concentrated on TW is a geopolitical gift, even if US can leverage them in peace time via sanctions, PRC can leverage them more during war time via disruption. Everyone knows this, no one will want to depend on TW fabs once suppliers on secure soil are established. TSMC / TW writing their suicide letter. I anticipate TSMC will do everything it can to delay these projects to buy more time.

MrBuddyCasino 5y ago
I wonder what the situation with production capacity is. I suspect TSMC will build a fab here and there that might suffice to make enough to supply the military, but not for anything else. Large sectors of the economy would still be cut off from chip supply, and we've seen how that went with the car industry. If PRC would conquer TW, they would not have an incentive to stop chip exports I think. Too much mutual dependency with the trade partners, and the party does not like domestic instability - unemployment would be unwelcome. Would TW blow up the factories though? It is said they can do this with a press of a button. > EU/US/JP all have sticks like tech sanctions of supply chains TSMC relies on Wouldn't that be self-sabotage? TSMC is in the strong position, everyone wants capacity, they have it. Intel and Samsung can't compete on the latest nodes.
audunw 5y ago
I still think this is good for Taiwan’s security. The world is very aware of Chinas growing ambitions, and everyone views Taiwan favorably. Taiwan needs to focus on being viewed as the better partner to liberal democratic countries. I think USA will keep putting troops near or at Taiwan in the coming years. Very slowly as to not create a huge provocation, but still steady. Taiwan doesn’t need the chip card to be considered worth supporting because a war between China and Taiwan will devastate the world economy in a hundred different ways. And regardless, it’ll take many decades before Taiwan isn’t such a large share of world chip production that they’d actually lose that card. Losing even 10% of the worlds cutting edge chip production would be utterly devastating. If China attacks Taiwan, and American troops are harmed, the US will have the justification they need to join the war, and the public support theyd need. I don’t think the US wants to go to war. But they need a threat that’s as credible as possible to deter China.
- dirtyid 5y ago
  > Losing even 10% of the worlds cutting edge chip production would be utterly devastating. The alternative is losing ~80% of all global chip production on TW, JP, SKR soil if US decides to fight PRC over TW. That's the leverage PRC has in war scenario. Losing leading node is survivable, losing east Asian fab sets globe back decades, and hurts US/western tech industry the most. A fundemental shift in region is US can't deter PRC over TW anymore. And as much as TW is viewed favourably, no one has committed to TW defense and US tried recruiting hard. Even US itself won't give TW security guarantee, and if you follow policy space, strategic thinking has shifted away from TW defense to TW armorer and blockading PRC past 1st island chain - increasing consensus and acknowledgement that TW is simply not defensible. Ultimately, no one wants to goto war and US can't deter PRC. So we have US and other blocs trying to maintain status quo for 10/15/20 years while shifting risk off TW sufficiently to mitigate esclation towards regional semi mutually assured destruction, a crisis much larger than just losing TSMC. Is this good for TW security? IMO it's not.

MrBuddyCasino 5y ago

I wonder what the situation with production capacity is. I suspect TSMC will build a fab here and there that might suffice to make enough to supply the military, but not for anything else. Large sectors of the economy would still be cut off from chip supply, and we've seen how that went with the car industry. If PRC would conquer TW, they would not have an incentive to stop chip exports I think. Too much mutual dependency with the trade partners, and the party does not like domestic instability - unemployment would be unwelcome. Would TW blow up the factories though? It is said they can do this with a press of a button. > EU/US/JP all have sticks like tech sanctions of supply chains TSMC relies on Wouldn't that be self-sabotage? TSMC is in the strong position, everyone wants capacity, they have it. Intel and Samsung can't compete on the latest nodes.

audunw 5y ago

I still think this is good for Taiwan’s security. The world is very aware of Chinas growing ambitions, and everyone views Taiwan favorably. Taiwan needs to focus on being viewed as the better partner to liberal democratic countries. I think USA will keep putting troops near or at Taiwan in the coming years. Very slowly as to not create a huge provocation, but still steady. Taiwan doesn’t need the chip card to be considered worth supporting because a war between China and Taiwan will devastate the world economy in a hundred different ways. And regardless, it’ll take many decades before Taiwan isn’t such a large share of world chip production that they’d actually lose that card. Losing even 10% of the worlds cutting edge chip production would be utterly devastating. If China attacks Taiwan, and American troops are harmed, the US will have the justification they need to join the war, and the public support theyd need. I don’t think the US wants to go to war. But they need a threat that’s as credible as possible to deter China.

dirtyid 5y ago
> Losing even 10% of the worlds cutting edge chip production would be utterly devastating. The alternative is losing ~80% of all global chip production on TW, JP, SKR soil if US decides to fight PRC over TW. That's the leverage PRC has in war scenario. Losing leading node is survivable, losing east Asian fab sets globe back decades, and hurts US/western tech industry the most. A fundemental shift in region is US can't deter PRC over TW anymore. And as much as TW is viewed favourably, no one has committed to TW defense and US tried recruiting hard. Even US itself won't give TW security guarantee, and if you follow policy space, strategic thinking has shifted away from TW defense to TW armorer and blockading PRC past 1st island chain - increasing consensus and acknowledgement that TW is simply not defensible. Ultimately, no one wants to goto war and US can't deter PRC. So we have US and other blocs trying to maintain status quo for 10/15/20 years while shifting risk off TW sufficiently to mitigate esclation towards regional semi mutually assured destruction, a crisis much larger than just losing TSMC. Is this good for TW security? IMO it's not.