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Why Taiwan Matters

Taiwan is a leading producer of chips needed for the development of new technologies and a democratic ally of Washington in Asia

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In order to preserve its hegemony in Asia and preserve security in the region, Taiwan represents a key ally for the United States. During the administration of former President Donald Trump these aspects were strengthened with different commercial, technological and military policies and agreements.

Taiwan is vital in the so-called “First Island Containment Chain” to counterbalance China and protect trade routes. The island is a prosperous country that has been under the protection of Washington and its allies in Asia. As the world’s 17th largest economy, Taiwan is a leader in the production of semiconductors and other high-tech goods.

The media stresses that Taiwan’s democracy is one of its greatest strengths, as it contrasts with the argument of the Communist Party of China (CCP) when it claims “that Western political structures are incompatible with Asian culture.”

The current president was a long-time advocate of “strategic ambiguity” towards Taipei, according to the press. Now the current president has taken a more aggressive stance during the presidential race and “pledged to work with allies to mount a more coordinated defense of human rights and democratic gains.”

However, Biden’s formal invitation to Hsiao Bi-khim, Taiwan’s representative to the United States, who became the first Taiwanese representative to attend a presidential inauguration in Washington, has provided some reassurance about the U.S. role vis-à-vis the Chinese Communist Party in relations with Taipei.

Taiwan leads the world in semiconductor production

Semiconductors are the backbone of emerging technologies. For more than 30 years, Taiwan has produced most of the chips needed for technological creations becoming the main source of these for the development of artificial intelligence (AI), autonomous vehicles and quantum computing. Taiwan Semiconductor Manufacturing Company (TSMC) is the world’s strongest mass-producer of high-quality chips.

TSMC factory in Hsinchu, Taiwan. Offers a variety of chip lines with high-capacity wafers. (Photo: Taiwan Semiconductor Manufacturing Co., Ltd.)

The island’s economy came into focus recently because, according to media reports, the automotive industry is suffering from “a shortage of chips used to manufacture new models.”

While the Asian country is not the only semiconductor producer, with the U.S. leading the way in chip design and electronic software tools, as the market moves “toward smaller and more powerful chips that require less power, Taiwan is increasingly in a field of its own,” Bloomberg noted.

The United States and Taiwan gave TSMC the green light to build a plant in Arizona. Production of 5-nanometer, 12-inch chips will begin in the first half of 2024 to meet strong demand for advanced chips in the North American market, the press reported.

Ford has been forced to eliminate two work shifts at its Chicago assembly plant, where the Ford Explorer and Lincoln Aviator SUV models are produced, due to a shortage of Taiwan-made chips for the automotive sector. (EFE)
Chips as Taipei’s key to international politics

The press has reported that the official estimate released by the Taiwanese government marks “the first time since 1990 that Taiwan’s GDP has grown at a faster rate than China’s.” The good management of the pandemic has allowed Taiwanese businessmen to keep the economic rhythm stable.

However, the bidding for chips for the new technological era has put Taipei in a privileged position to counter political pressure from Beijing.

With the U.S. export control measures on Huawei, it is evident how the transnational semiconductor value chain can be “weaponized.”

The local press has reported that countries that have stayed away from Taipei due to their strong closeness to Beijing, such as Germany, have been interested in Tsai Ing Wen’s government pressuring private industry over semiconductor production.

Local press shows the displeasure of Taiwanese citizens at Germany’s interest in China. Germany is one of the Chinese Communist Party’s main allies in the West.

A week after Volkswagen’s CEO Stephan Wollenstein told the press that the company is unaware of the genocide in Xinjiang by the Chinese Communist Party, businessmen and the Berlin government relented and began to reach out to China’s democratic counterpart.

Biden administration officials told the press that they “have requested an ad hoc meeting next week with the Taiwan government and private industry” to increase the supply of chips to American automakers.

It would be the first higher profile meeting between Biden-Harris Administration officials and their Taipei counterparts. Communications between the new American administration and the Tsai Ing Wen government will revolve around recent incursions by Chinese military aircraft in the southern South Sea.

Chinese aircraft target U.S. navy in Taiwan Strait

Three days after Joe Biden’s inauguration as president, Taiwan’s Ministry of Defense reported that 26 aircraft of the Chinese regime have made incursions over Taiwan.

Chinese bombers defy the Biden-Harris administration in Taiwan. (EFE)

The intelligence service intercepted H-6 bomber pilots whose cockpit conversations “confirmed orders for the simulated targeting and launching of anti-ship missiles against the U.S. carrier,” the Financial Times reported.

The Theodore Roosevelt Carrier Strike Group is the U.S. Navy’s largest forward fleet. With more than 50 military vessels and submarines, 140 aircraft and 20,000 sailors in the area, it “conducts forward naval operations in support of American interests” in the pursuit of a free and open Indo-Pacific region.

The deployment of the American navy works in conjunction with the military bases the United States has established in allied countries such as Japan, South Korea, the Philippines and Taiwan. This is a relationship that intensified since the arrival of President Tsai Ing-wen in 2016, as she has consolidated the island politically, economically and diplomatically in the face of threats from Beijing.

Taiwan Defense Ministry experts told the press that “Chinese Army Su-30 [fighters] can carry Kh-31 anti-ship missiles, and H-6 bombers and J-16 fighters can carry YJ anti-ship missiles being a clear threat to the American surface fleet.”

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