Taiwan Vows to Safeguard Interests Through 'Chip 4'

Facts

• On Wednesday, Taiwan's Deputy Economy Minister, Chen Chern-chyi, said Taiwan will rely on the 'Chip 4' alliance to protect the interests of local semiconductor companies. He also addressed concerns about the potential impact of this initiative on the country's tech industries.¹
• Chen also said Chip 4 - comprising Japan, South Korea, Taiwan, and the US - seeks to create a resilient and stable supply chain of semiconductors.²
• This announcement comes a week after a preliminary meeting of the alliance was held virtually, which reportedly discussed overarching goals. Chip 4 is widely considered part of US Pres. Joe Biden's efforts to counter China in this sector.³
• Taiwan Pres. Tsai Ing-wen also reinforced the island's commitment to ensuring reliable supplies of semiconductors following a global shortage and urged allies to boost cooperation amid mounting tensions with Beijing.⁴
• Taiwan is attempting to balance business and security interests, with the US trying to curb China's military access to technology and PRC plans to expand domestic chip production. This also comes amid rising tensions in the Taiwan Strait.⁵
• The production value of Taiwan's semiconductor industry – which reportedly accounts for more than 60% of the global metal casting market – is projected to outpace global expansion this year. However, supplies would likely be disrupted in the event of a conflict in the Taiwan Strait.⁶

Sources: ¹Al Jazeera, ²Nikkei Asia, ³Focus Taiwan, ⁴Reuters, ⁵Bloomberg and ⁶Taipei Times.

Narratives

• Pro-China narrative, as provided by Global Times. This is an unacceptable attempt by Taiwan to foster more independence by joining an international organization whose goal is to undermine the PRC. With the way Beijing‘s chip sector is growing, this decision by the island - not to mention the US, Japan, and South Korea - is doomed to fail. Taiwan will regret going against China on this.
• Anti-China narrative, as provided by The Asahi Shimbun. This is a straightforward economic agreement between Taiwan and three other countries - it has no impact on the status quo between China and Taiwan. Beijing shouldn’t be so fast to overreact to things like microchips or US diplomatic visits to Taiwan. The PRC would be best served by focusing on talks to further peace.