29th Sep 2023

Microchip factory to forge 'even closer' EU-Taiwan ties

  • Europe is aiming to double its semiconductor market-share by 2030 (Photo: IBM Research)
Listen to article

Taiwan's decision to build a microchip factory in Germany will deepen EU political ties, despite Chinese opposition, Taipei has said.

"TSMC's [Taiwan Semiconductor Manufacturing Company] investment in Europe will help bring even closer cooperation between Taiwan and the EU," Taiwan's economy minister Wang Mei-hua told press on Wednesday (9 August), according to Reuters.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

"Just like how Taiwan and the United States are continuing to strengthen cooperation ... TSMC going to Europe will certainly strengthen bilateral relations in the future," she added — referring to what will be Taiwan's first-ever high-tech plant in Europe.

The €10.2bn facility in Dresden, eastern Germany, will produce semiconductors — a key electronic component — for cars, domestic appliances, and industrial goods and employ 2,000 people when it starts up in 2027.

It will be co-owned by TSMC and German and Dutch firms Bosch, Infineon, and NXP, but also lubricated with a €5bn German government subsidy, according to German newspaper Handelsblatt.

"Germany is now probably becoming the major location for semiconductor production in Europe," German chancellor Olaf Scholz said on Tuesday.

"That is important for the resilience of production structures around the world, but it is also important for the future viability of our European continent, and it is of course particularly important for the future viability of Germany," he added.

The German state aid still has to be approved by the European Commission.

But EU industry commissioner Thierry Breton also said on Tuesday the TSMC factory would bring "stronger security of supply for Europe".

And the EU has launched a €43bn plan, the European Chips Act, designed to double domestic production capacity by 2030.

The initiatives come after the Covid pandemic and Russia's invasion of Ukraine disrupted global supply chains, exposing EU vulnerability to overseas chip-makers.

Ever-louder Chinese sabre-rattling on Taiwan, a major semiconductor supplier, has also alarmed the EU.

China is yet to comment directly on TSMC's new German deal.

But 10 Chinese warplanes flew into Taiwan's air-defence zone on Wednesday, one day after the German enterprise was announced, in the second incursion of its type in a week, Reuters reported.

China has also hosted several war-games next to its former province, which broke away in the 1940s, and aired pro-invasion propaganda films.

And it previously punished the EU's Lithuania with unofficial trade sanctions for building closer diplomatic and business ties with Taipei.

Meanwhile, the EU's foreign affairs chief, Josep Borrell, spoke with his Chinese counterpart Wang Yi on Monday in preparation for an EU-China summit later this year.

China and Taiwan are both angling for a bilateral investment agreement (BIA) with the EU in future.

But Lithuania aside, China's other anti-EU sanctions — targeting MEPs and EU officials who blacklisted Chinese civil servants over human-rights abuses — have stood in the way of progress.

"The EU will continue to reduce critical dependencies and vulnerabilities, including the supply chain and will de-risk and diversify where necessary," said an EU strategy paper on China adopted in June.

A German strategy paper on China from July also said: "China is seeking to create economic and technological dependencies with a view to using these to assert political objectives and interests".

"China has changed. As a result of this and China's political decisions, we need to change our approach to China," Germany added, referring to Beijing's ever-more hawkish foreign policy.


Supporting Taiwan 'like carrying water in a sieve'

China's ambassador to Belgium, Cao Zhongming, says the US has been distorting, obscuring and hollowing out the 'one-China' principle and unscrupulously undermining China's core interests. This is sheer double standards and a shameful act of bad faith.

EU’s €500m gender violence plan falls short, say auditors

The 'Spotlight Initiative' was launched in 2017 with a budget of €500 million to end all forms of violence or harmful practices against women and girls in partner countries, but so far it has had "little impact", say EU auditors.

Latest News

  1. Poland's culture of fear after three years of abortion 'ban'
  2. Time for a reset: EU regional funding needs overhauling
  3. Germany tightens police checks on Czech and Polish border
  4. EU Ombudsman warns of 'new normal' of crisis decision-making
  5. How do you make embarrassing EU documents 'disappear'?
  6. Resurgent Fico hopes for Slovak comeback at Saturday's election
  7. EU and US urge Azerbijan to allow aid access to Armenians
  8. EU warns of Russian 'mass manipulation' as elections loom

Stakeholders' Highlights

  1. International Medical Devices Regulators Forum (IMDRF)Join regulators, industry & healthcare experts at the 24th IMDRF session, September 25-26, Berlin. Register by 20 Sept to join in person or online.
  2. UNOPSUNOPS begins works under EU-funded project to repair schools in Ukraine
  3. Georgia Ministry of Foreign AffairsGeorgia effectively prevents sanctions evasion against Russia – confirm EU, UK, USA
  4. International Medical Devices Regulators Forum (IMDRF)Join regulators & industry experts at the 24th IMDRF session- Berlin September 25-26. Register early for discounted hotel rates
  5. Nordic Council of MinistersGlobal interest in the new Nordic Nutrition Recommendations – here are the speakers for the launch
  6. Nordic Council of Ministers20 June: Launch of the new Nordic Nutrition Recommendations

Stakeholders' Highlights

  1. International Sustainable Finance CentreJoin CEE Sustainable Finance Summit, 15 – 19 May 2023, high-level event for finance & business
  2. ICLEISeven actionable measures to make food procurement in Europe more sustainable
  3. World BankWorld Bank Report Highlights Role of Human Development for a Successful Green Transition in Europe
  4. Nordic Council of MinistersNordic summit to step up the fight against food loss and waste
  5. Nordic Council of MinistersThink-tank: Strengthen co-operation around tech giants’ influence in the Nordics
  6. EFBWWEFBWW calls for the EC to stop exploitation in subcontracting chains

Join EUobserver

Support quality EU news

Join us