How can the elections in Taiwan shake up Europe's industrial future?

How can the elections in Taiwan shake up Europe’s industrial future?

A Chinese claim since the partition of 1949

In fact, the relations of this island with a population of 23 million and a thriving industry continue to deteriorate with its Chinese neighbor. For two years, military pressure has increased in the strait that separates it from mainland China, while Xi Jinping has made more threatening declarations. In his New Year 2024 wishes, the Chinese president even assured that China would “surely be reunified” this year. A way to tighten the grip on Taiwanese democracy. Beijing considers the island to be a province that has not been unified since the civil war which ended in 1949 with the victory of Mao Zedong’s Chinese Communist Party over the nationalists led by General Chiang Kai-shek. The latter had to take refuge in Taiwan.

Europe has taken stock of the threat. To secure its supplies, a European regulation on semiconductors (Chips Act) came into force on September 21, 2023. It mobilizes an envelope of 43 billion euros for innovation, production and financing of small and medium-sized semiconductor companies. The objective aims to double the European Union’s share of global chip production by 2030, bringing it to 20%.

Concrete translation of these major maneuvers: the Taiwanese company TSMC announced the commissioning of its first European factory in Dresden (Germany) in 2027. France, which had hoped to host this project until the last moment, is not However, not to be outdone. A factory will be built in Crolles (Isère), in 2024. Between Chambéry (Savoie) and Grenoble (Isère), in the heart of the French “Silicon Valley”, the Franco-Italian groups STMicroelectronics and American GlobalFoundries are joining forces to create 1 000 jobs and ultimately provide 6% of European chip production. This site represents “the largest industrial investment in recent decades, excluding nuclear power”, welcomes Bruno Le Maire, Minister of the Economy. The fate of Taiwan is not only a democratic issue: it also concerns the industrial future of Europe. And our daily life.

An island hidden behind its fleas

Aware that the world depends on its factories, Taiwan is careful not to export its most sophisticated foundries. If the chips constitute one of the sources of Chinese desires, they are also the best defense of the island, because they ensure American support and slow down Beijing in its attempts to invade.

Popular China, in fact, is also very dependent on Taiwan: the island supplies it with 70% of its electronic chip needs. Another sign of Taiwanese dominance in the market is that TSMC supplies 92% of the most advanced chips in the world. Its components, in which every nanometer counts to gain power, are essential to the arms industry (remote-guided missiles, fighter planes) and artificial intelligence. Taiwan carefully keeps them on its territory and erects a “silicon shield” around the island – the material on which the chips are engraved – to deter China from an invasion.

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