TSMC Expands Globally: The ‘Silicon Shield’ Against Geopolitical Risks

January 9th 2025

Source: Japan News

In Summary:

Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s leading semiconductor foundry, is accelerating its global expansion with new production facilities in Japan, the United States, and Germany. The company recently began mass production at its first Japanese plant, producing 12-28 nanometer chips, and plans to launch a 4-nm chip facility in Arizona by early 2025. A plant in Dresden, Germany, is slated for completion in 2027, establishing a "quadrupolar production system" across Taiwan, Japan, the U.S., and Europe.

TSMC's “Silicon Shield” strategy has been pivotal in safeguarding Taiwan against potential aggression from China by emphasizing the island’s strategic importance in the global chip supply chain. By spreading production globally, TSMC aims to mitigate risks from concentrated production and meet rising international demand for semiconductors. However, this global footprint is also driven by challenges at home, including shortages of water, electricity, and skilled labor.

The expansion raises questions about the geopolitical implications of TSMC's move, particularly as the U.S. prepares for the inauguration of President Donald Trump. Concerns over increased tariffs and potential technology transfer to the U.S. loom large, alongside challenges such as higher production costs in overseas markets.

While TSMC's global ventures are seen as a boon for host countries like Japan, the U.S., and Germany, they highlight the delicate balance Taiwan must maintain as a critical player in the semiconductor industry amidst growing geopolitical tensions.

Read the full article at: Japan News