The Times reported on the 17th (local time) that a fierce battle is taking place between the two countries as China is taking over Taiwan manpower and technology by any means to gain the upper hand in the semiconductor industry.
Although it is not illegal for Taiwanese citizens to work for Chinese companies, it has recently banned Chinese investment in domestic companies in sensitive industries such as semiconductors and hiring workers.
However, more and more Chinese companies are using tax havens such as the Cayman Islands or ghost companies to disguise themselves as Taiwanese or foreign companies.
“Chinese companies look for other ways when they can’t do it publicly,” said Scott Kennedy, a Chinese economic policy expert at the Center for Strategic and International Studies (CSIS), a U.S. think tank. “Taiwan has lost a lot of talent, but it is trying to prevent further brain drain.
Taiwan organized a task force within the Ministry of Justice’s Bureau of Investigation to respond to China semiconductor operations in 2020.
An official from the Taiwanese government said, “The cases that have been taken so far are only the tip of the iceberg.”
In January, a Chinese state-run company was convicted of illegally operating in Taiwan by paying wages to overseas accounts via a Hong Kong subsidiary, and a Shanghai company, which appears to be a domestic company, is also under investigation for handing over a semiconductor design blueprint to China.
Taiwan is also preparing a new law to protect semiconductor technology in terms of national security, such as raising the level of punishment for such acts from one year to three years in prison, raising the fine from $5,000 to $500,000 and imposing a maximum of 12 years in prison for leaking core semiconductor technology.
Taiwan also puts its dominance of semiconductors as one of its important defense strategies. The strategy, called the “silicon shield,” is a concept that semiconductors are very important to both the U.S. and Chinese economies and will prevent them from attacking Taiwan.
However, many people, including pro-Taiwanese figures in the U.S., believe this logic is no longer valid. The fact that Taiwan’s dominance in the semiconductor industry is too large itself could pose a great risk to the global economy if China invades, blocks, and destroys cyber.
