Semiconductor giant TSMC said it was determined to "keep its roots in Taiwan" as it launched a massive facility in the island's north on Friday geared towards developing the world's most cutting-edge microchips.

Taiwan Semiconductor Manufacturing Company (TSMC) controls more than half of the world's output of microchips, which are the lifeblood of the modern global economy, powering everything from coffee machines and smartphones to cars and missiles.

Like the new research and development facility, much of TSMC's manufacturing base is in the northern city of Hsinchu, where its state-of-the-art facilities are producing ever-smaller silicon wafers that have skyrocketed in demand, especially due to the recent boom in AI-related technology.

At the Friday launch of the R&D facility, chairman Mark Liu said the centre would "develop world-leading technologies in the semiconductor industry more actively to explore two-nanometre and 1.4-nanometre technology, and even smaller".

The company is racing to begin mass production of a 1.4-nanometre chip -- tinier than a fraction of a fingernail -- ahead of its rival Samsung, the world's second-largest producer.

Its production lines have expanded beyond Taiwan as Western powers have raised concerns about the crucial industry being centred on an island that China claims as its territory -- having ramped up political and military pressure on it over the past year.

But CEO C.C. Wei said Friday that TSMC intended to keep the heart of its technological prowess in Taiwan.

"We want to use this opportunity to show Taiwanese people TSMC's determination to keep its roots in Taiwan," Wei said during the inauguration, which was attended by Taiwan's premier as well as TSMC founder Morris Chang.

"We have heard voices expressing concerns about whether TSMC is moving its focus abroad and whether TSMC is halting its development in Taiwan. We have to say 'no'," he continued.

"With the opening of the global R&D centre, we are telling Taiwanese people our roots will remain in Taiwan."

A planned Arizona plant -- one of the largest foreign investments in the United States -- is currently delayed until 2025 due to a shortage of skilled workers, a blow to the White House's plans to bring more chip production to the US.

TSMC has said they are sending over Taiwanese technicians to help train the foundry's staff.

The company is facing similar issues as it explores the possibility of a plant in Dresden, citing concerns about gaps in Germany's talent pool.

- 'Strategic significance' -

Global recognition of TSMC has spiked in the past year, much of it coming after the US unveiled sweeping curbs aimed at cutting off Beijing's access to high-end chips, chipmaking equipment and software used to design semiconductors.

Beijing has reacted with similar moves, restricting the sales of chips from American giant Micron and announcing that exports of rare minerals vital in the production of semiconductors require a licence.

In the middle is self-ruled Taiwan -- the world's primary manufacturing base of semiconductors -- which China considers its own territory and has vowed to take one day, by force if necessary.

But the entire supply chain, from chip design to manufacturing and final product assembly -- which largely takes place in mainland China -- is sprawling and complex, and has created an interdependence among all players.

"The semiconductor industry requires close global collaboration, from US designs to European equipment and Japanese materials to Taiwanese manufacturing and R&D," said Taiwanese Premier Chen Chien-jen, who attended TSMC's event in place of President Tsai Ing-wen, who was diagnosed with Covid this week.

Chen went on to say that TSMC's new R&D facility was of "important strategic significance".

"Taiwan's industrial competitiveness lets the world notice that Taiwan is not only a resilient democratic island but also a prosperous technology island," he said.

By: DocMemory
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