China invasion of Taiwan would cause major blow to high-tech supply chain, warns boss of semiconductors firm | World News

According to the chief executive of one of the most important companies involved in making key semiconductor chips, if China attacked Taiwan, it would have a major impact on the global high-tech supply chain “within weeks”.

Speaking exclusively to Sky News, Doris Sue, KCEO Taiwanbased in Global Wafers, also said that customers have “a lot of concerns” about China’s intentions in Taiwan and that this is one of the reasons the firm chose to locate its new plant in Texas.

Rising tensions in the Taiwan Strait have fueled fears that companies will seek to protect themselves by withdrawing from the self-governing island. China Sees its own and direct long-term investments as elsewhere.

Taiwan is a major global player in technological development and manufacturing, particularly semiconductors.

Semiconductors are the main microchips that are called the “brains” of modern electronics. They power everything from airplanes and appliances to cars and smartphones.

Taiwan produces about 90% of the world’s most advanced semiconductors and about 50% of the broader market, most of them made by world leader TSMC.

Any disruption to this would be disastrous for global supply chains.

Global Wafers manufactures silicon wafers, one of the key components of semiconductors. It is the world’s third largest supplier of this component and one of TSMC’s most important suppliers.

Doris Sue
Doris Sue says one of the reasons for building a new factory in Texas is ‘risk management’.

“Some of our clients are very concerned about the overall security in Taiwan,” says Ms. Hsu. “They want us to be more diverse.”

“Not in 20 years have we been asked as frequently as we have recently, so many customers saying ‘Hey Doris, what if something goes wrong? What’s your contingency plan?'”

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How could a Sino-Taiwan war hurt the economy?

Speaking about the company’s new $5bn (£4bn) chip plant in Texas, he said one of the reasons for the decision was “emergency or risk management”.

While GlobalWafers is already a very globalized company, with 18 operations in nine countries, the risk of future instability is influencing decision-making.

“I’ve been in this industry for 20 years,” she says.

“In the last 20 years, I’ve had to care more about business, economic issues, engineering stuff. What about IP? [intellectual property]? How about your leadership or technology? But now I have to think about world political issues!

‘Attack will affect $2 trillion in trade’

Semiconductors are one of the areas where Taiwan punches well above its weight. Despite its small size, it is the 16th largest trading economy in the world.

The research organization Rhodium Group estimated that any invasion or blockade of Taiwan would affect economic activity $2 train, before taking into account any sanctions or secondary effects.

Global Wafers makes silicon wafers, a key component in semiconductors.

There are concerns that some firms, perhaps burned by Russia’s experience, will try to move some operations off the island.

British bicycle maker Brompton Bikes is just one firm that has indicated it will do so.

But experts say there is no mass exodus, just a gentle trickle of long-term investment decisions to go elsewhere.

“Most companies aren’t actually thinking about pulling out or relocating — but expanding,” explained Christie Zun Zhu-su, director of the Taiwan-ASEAN Studies Center at the Qinghua Institution of Economic Research.

“They are extending their supply or supply chain from Taiwan to other countries or other regions, so that they have somewhere to back up if Taiwan can’t produce as quickly or as quickly as the expected time frame.”

China is one of the many nations that also relies on Taiwan’s high-tech sector, and this has been cited by some experts as a reason for not being attacked.

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