Taiwan’s companies retain a global edge despite efforts by China to compete by spending huge sums on tempting their talent.

The News Lens
Date: 2018/09/14
By: By Matthew Fulco, Taiwan Business TOPICS Magazine

Credit: Micron

For years, industry analysts have cautioned that Chinese competitors in the semiconductor sector would steadily erode the technology advantages of Taiwanese chipmakers, ultimately wooing away many local chip-makers’ customers with lower prices.

Despite China’s rapid progress in the semiconductor sector in recent years, Taiwan has thus far been able to leverage its considerable strengths to ward off that challenge. At the same time, local IC (integrated-circuit) makers know they will need to be vigilant to remain ahead of their Chinese competitors. As semiconductors are among Taiwan’s most important exports, it can’t afford to cede the industry to China.

In its Made in China 2025 plan, Beijing has targeted semiconductors as a strategic industry it aims to dominate. Since 2015, China has surpassed Taiwan in terms of annual output value for IC design, one of the main segments of the semiconductor industry. It is also closing the gap with Taiwan in another area, IC packaging and testing.