Fresh China-Taiwan tensions emerge - Chinese semiconductor companies

Taipei: There are reports that the Chinese military is preparing to attack Taiwan. But even before that, there seemed to be a conflict flaring up in the field of semiconductors between China and Taiwan. Authorities in Taiwan have raided 10 Chinese companies and have started thorough interrogation of more than 70 people. Taiwan has accused Chinese semiconductor companies of illegally trying to attract engineers and skilled manpower from Taiwan. This is the second action taken by Taiwan against Chinese companies in the last three months. Semiconductors, also known as ‘integrated circuits’ or ‘microchips’, are the ‘brain’ of modern electronics. Various semiconductors are used in all fields, from smartphones to satellites. Taiwanese companies that produce low-cost semiconductors are in high demand worldwide.

During the Coronavirus period, there was a ‘supply chain crisis’. International companies that lost faith in China began to withdraw their investments. At the same time, US President Donald Trump was using Taiwan during the trade war against China, cutting off supplies to China of materials needed to manufacture semiconductors. Supplies from Taiwan to China have not been smooth ever since.

This geopolitical tension between the United States and China has jolted Chinese semiconductor manufacturing companies. The Taiwanese Ministry of Labour has accused China of attracting engineers and skilled manpower from the Taiwanese semiconductor sector. President Tsai Ing Wen’s government has blamed Chinese semiconductor companies based in Taiwan for being involved in the crime.

Against this backdrop, in the last 24 hours, the authorities in Taiwan raided Chinese companies in Hsinchu, Taiyuan, including the capital Taipei. More than 70 people from Chinese companies were interrogated on charges of illegally transporting semiconductor engineers and related workers to China. The Singapore Post daily carried this report. This has added to the tensions already prevailing between China and Taiwan, reported the daily.

This is the second action taken by Taiwan’s Tsai government against Chinese companies in the last three months. Earlier in March, the internationally renowned Taiwan Semiconductor Manufacturing Company (TSMC) investigation revealed that eight Chinese companies were luring local engineers to them. At the time, China was accused of stealing Taiwan’s intellectual property by offering Taiwanese engineers and workers more than double their salaries. This is a crime under Taiwanese law. But China has dismissed Taiwanese allegations.

The United States has accused China of stealing American intellectual property by forcing US researchers and scientists to work for it.