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If Trump comes into power, TSMC will be in jeopardy!

Update time : 2024-11-05 16:59:46

Republican candidate Donald Trump recently said in an interview with a popular podcast program that "Taiwan has snatched away probably 100% of our chip business." This isn't the first time Trump has made such remarks. As early as in an interview with Bloomberg in July, he said, "Taiwan has snatched the US chip business and should pay protection money to the US."

Zhang Zhongmou, the founder of TSMC, the world's largest semiconductor foundry, once warned that due to the escalating geopolitical tensions, free trade in the semiconductor industry has come to an end, making TSMC's situation, which is already like that of a strategic material, even more difficult. TSMC has truly become a highly contested area, and the most severe challenges are right ahead.

Under the overbearing coercion of the Biden administration, TSMC was forced to build its first wafer fab in Arizona, the United States. It will start producing chips using 4-nanometer process technology in the first half of 2025. The second wafer fab, which will use the most advanced 2-nanometer process technology, is scheduled to start production in 2028. In April this year, TSMC issued a statement announcing its plan to build a third advanced wafer fab in Arizona.

Judging from TSMC's establishment of factories in the US, TSMC, which has become a global strategic material, has been forced to shift to the US under pressure, even if it doesn't make much money there.

Trump's perception of Taiwan is twofold. On one hand, he believes that Taiwan has snatched the US chip business and, if elected president, he will take it back. On the other hand, he thinks that Taiwan is too far from the US and should pay more "protection money" to the US. He also proposed that Taiwan's defense expenditure should account for 10% of its GDP (currently less than 3%). These are the two things Trump intends to do. Taiwan should be prepared!

TSMC's advanced manufacturing processes are far ahead of the world, with a global market share of as high as 92% in advanced manufacturing processes, making it extremely profitable and enjoying great success. How could such a strategic material not make Americans envious?

The remarkable achievements of Taiwan's semiconductor industry are the result of the hard work and efforts of hundreds of thousands of semiconductor professionals in Taiwan over many years. It didn't fall from the sky. In the beginning, the US regarded the semiconductor industry as a labor-intensive industry with high energy consumption, high pollution, and low profits, so it was unwilling to engage in it. Therefore, Trump's claim of "theft" is simply nonsense, completely ignoring the facts and calling a deer a horse.

With the acceleration of the new round of scientific and technological revolution and industrial transformation, the requirements for and dependence on semiconductor products are increasing. As Taiwan's semiconductor industry development is at the top of the world, the US has been coveting it for a long time. Trump is using the so-called "theft theory" to reap the fruits of the labor of Taiwan's semiconductor industry. This is just the manifestation of the US's robber and hegemonic logic in the new era. One could say that Trump is being more straightforward.

Let's take a look at the shareholding structure of TSMC. Although TSMC is a well-known semiconductor enterprise in Taiwan, China, its largest shareholder is Citibank of the US, with a shareholding ratio of 20.5%. The total shareholding ratio of foreign investors is 78%, while the shareholding ratio of the Taiwan administrative department is only 6.4%. In fact, TSMC is a Taiwanese enterprise controlled by US capital, and it wouldn't be an exaggeration to call it a US enterprise.

It was reported that Rick Cassidy, the president of TSMC's US division, pointed out in a webinar on October 23 that the chip yield rate of TSMC's Phoenix factory is about 4 percentage points higher than that of similar factories in Taiwan. The yield rate is a key measurement standard in the semiconductor industry and determines whether a company can afford the huge costs of a chip factory. What Cassidy said conveys to US politicians and the outside world the message that there is no problem with TSMC's high-end chip production in the US and the quality is even higher. In other words, TSMC can even transfer the production of 1-nanometer or even more advanced chips to the US to build factories.

If Trump wins the election on November 5, Taiwan will surely face a situation of losing both politically and economically. TSMC, the so-called "sacred mountain protecting Taiwan" in Taiwan, will accelerate the transfer of both its more advanced manufacturing processes and production capacity to the US, becoming a veritable "TSMC-US". The US will plunder TSMC, take it for itself, turn it into a pillar industry of the US semiconductor industry, increase US employment rates and semiconductor product exports, and boost the US's sluggish economy.

As everyone knows, the DPP authorities in Taiwan are completely leaning towards the US, clinging to its thigh, relying on it as a backer, engaging in so-called "relying on the US to resist China" and "relying on the US to seek independence", but in fact they are just groveling and showing a servile attitude. The US regards Taiwan as a pawn to contain China and demands whatever it wants from Taiwan. As the Biden administration is about to end, it still approved a new round of arms sales to Taiwan worth nearly $2 billion (about $26.42 billion in New Zealand dollars) on October 25, which is the largest arms sale to Taiwan during the Biden tenure.

If Trump is re-elected, he will demand an exorbitant "protection money" from Taiwan, increase the intensity of arms sales to Taiwan, and will unceremoniously take away TSMC and squeeze Taiwan dry. When Taiwan is left with only an empty shell and not much residual value, it will inevitably change from a "pawn" to a "discarded pawn" with a tragic fate.

The US's "double standards" politics has disrupted the world order, accelerating the evolution of the once-in-a-century changes in the world. Under the US's rampant unilateralism and trade protectionism, the prospects for the world economic recovery are not optimistic. The result of the DPP authorities in Taiwan clinging tightly to the US's thigh is that they will be at the mercy of the US, and it is only natural that TSMC will be plundered by the US.
Even if TSMC is plundered by the US, the sky won't fall. It's just a chip after all. However, peace in the Taiwan Strait and the reunification of the motherland are related to the great rejuvenation of the Chinese nation. Currently, the greatest threat to peace and stability in the Taiwan Strait and the greatest damage to the status quo of the Taiwan Strait are the separatist activities of the "Taiwan independence" forces and the connivance and support of external forces led by the US. We must be vigilant, take effective measures to counteract, and exert strong deterrence.

Taiwan will be squeezed dry by the US, and TSMC will become "TSMC-US", which is the result of the DPP authorities' cross-strait policies. The rough seas and dangerous military situation in the Taiwan Strait are also caused by the DPP authorities' cross-strait policies. It can be seen that the DPP authorities are the complete instigators of betraying Taiwan's interests and disrupting peace in the Taiwan Strait. The DPP doesn't fall, Taiwan won't get better.

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