ISSUE 111                                                                                  October 7, 2021
Taiwan Weekly
Reliable report and analysis of the most important issues in Taiwan
In This Issue
● Featured Editorial: 
● This Week in Taiwan: 
Other Important Events This Week


U.S. Forces TSMC to Hand Over Secrets, Taiwan Government Stays Silent
At a global semiconductor summit, Secretary of Commerce Gina Raimondo of the United States asked semiconductor companies like the Taiwan Semiconductor Manufacturing Company (TSMC) and Samsung to voluntarily hand over trade secrets such as inventory, orders, and sales data within 45 days.
(Photo from: China Times)
Featured News

U.S. Sets Deadline for TSMC to Hand Over Trade Secrets

China Times, October 1, 2021


In order to address its chip shortage, the United States has requested major semiconductor manufacturers, among others, to hand over their customer lists, inventories and related confidential corporate information within 45 days. In response, Minister of Economic Affairs Wang Mei-hua stated on September 29, 2021 that those companies have their own considerations in deciding what to disclose or not. Chairman Johnny Chiang of the opposition Kuomintang (KMT)  questioned that in time of major difficulties the industry might encounter, shouldn't the government be aware of the situation and make an effort to give help as soon as possible? The Taiwan Semiconductor Manufacturing Company (TSMC) has a big heart for Taiwan. In contrast, the response from the Ministry of Economic Affairs (MOEA) was unexpectedly heartless and ungrateful. "For what else do we need this government?”

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Featured Editorial
According to media commentary, the administration of President Tsai Ing-wen should no longer pretend to be deaf to the arbitrary demands of the United States. It should support TSMC and reject the unreasonable demands.
(Photo from: China Times)

Taiwan's Government Needs Guts

China Times Editorial, October 1, 2021


Secretary of Commerce Gina Raimondo of the United States issued a notice to international semiconductor companies, including the Taiwan Semiconductor Manufacturing Company (TSMC), at the semiconductor summit on September 23, demanding that the supply chains to voluntarily share information about their inventories and related data before November 8. Otherwise, the United States may invoke the National Defense Act, which traces to the Cold War era, to determine whether the companies are hoarding semiconductor chips. Frankly speaking, if any American factory is intimidated, it is a matter of the United States, and we have no right to poke nose into it. But the matter involves TSMC, often dubbed the “sacred mountain which protects the country” in Taiwan; then it is too unaccountable and unreasonable for the government to pretend to be dumb and deaf on this issue.


The chief reason for the widespread shortage of semiconductor chips is because the auto sector’s demand rebounded after the pandemic situation ameliorated, but the production was hampered by lack of chips. In February this year, Federal Minister for Economic Affairs Peter Altmaier of Germany also sent a letter to TSMC for assistance. However, when car dealers reduced their orders last year, Taiwan chip manufacturers had warned that it would be difficult to recover once the orders were reduced. The words were prophetic—the shortage of chips has spread from Europe to the United States.

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Featured Editorial
China has recently implemented a dual policy of controlling energy consumption (curbing both energy consumption intensity and total energy consumption), which has set off a storm of power suspensions in various places. These developments not only adversely affect economic growth on the mainland but also impact global supply chains.
(Photo from: China Times)

Electric Cuts Hit China’s Businesses and Economy

Commercial Times, October 1, 2021


On the eve of Mid-Autumn Festival in September, the policy of “dual control” on energy consumption( i.e. energy consumption intensity, total energy consumption volume) by the Chinese government incurred storms of electricity curtailment and production suspension making production of industry in great chaotic pace while its impact was exacerbated by the recent surging price of coal. Despite Premier Li Keqiang on September 30 guaranteeing energy and electricity supply, the market worried that it had brought negative impact on China’s economic growth.


In September 2020, the mainland proffered a “dual carbon dioxide” goal demanding a sharp raise of the level of reduction on carbon dioxide emission by energy consumption, however, with the onslaught of the global coronavirus (COVID-19) pandemic, China, the first country that realized economy recovery, revived its status as the manufacturing center of the world. With the swarming-in of orders from all over the world, its factories accelerated production with extra operation hours leading to a surge in electricity consumption each month.

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This Week in Taiwan
Fumio Kishida, the new president of Japan's ruling Liberal Democratic Party, recently took office as prime minister of Japan. He previously welcomed Taiwan's participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and stated that Taiwan is an important economic partner.
(Photo from: United Daily News)
September 27: The Central Epidemic Command Center announced that starting from this week, there is no need to take every other seat in cinemas, no capacity limit on tour buses, and no restrictions on eating and drinking on both the High Speed Rail and Taiwan Railways. If the pandemic continues to stay under control, restrictions on recreational facilities like karaoke will be eased with conditions. But masks are required to sing, and gloves required to play mahjong. However, dance halls and bars are to remain closed. 
September 27: In order to strengthen the combat capability of conscripts, the Ministry of National Defense will resume military training service in September. After recruits complete basic training, they must serve in military units and participate in a lottery to serve in the outer islets of Kinmen and Matsu. According to regulations, men born after January 1, 1994 are required to receive four months of military training. 
September 27: The "power rationing" crisis continues to spread rapidly throughout China, affecting Shanghai and economic centers along Guangdong, Jiangsu, Zhejiang, and Shandong all the way to the inland and northeastern provinces. Chinese and foreign companies in light and heavy industry, solar energy, and consumer electronics have been impacted, affecting Apple and Tesla suppliers and Taiwanese business clusters on the mainland. Some companies have been forced to suspend production until the October 1 long weekend holiday. Power cuts have expanded from industry to the public, impacting China's economic growth and global supply chains. 
September 28: When administering the BioNTech vaccine to patients, the En Chu Kong Hospital in New Taipei accidentally inoculated 25 people using undiluted vaccine stock solution. President Wu Chih-hsiung confessed negligence and apologized publicly. The hospital will track and care the health condition of the 25 affected patients on a daily basis. Of the 13 hospitalized, 11 have been discharged as of October 3. The remaining 2 hospitalized exhibit stable condition. The Health Bureau of the New Taipei City Government decided to fine the hospital NT$250,000 (about US$9,000).
September 28: Premier Su Tseng-chang went to the Legislative Yuan to deliver his policy address. Because he did not recognize the "3+11" quarantine policy as connected to the latest epidemic outbreak, the Kuomintang (KMT) caucus of the Legislative Yuan launched a boycott, demanding that he apologize. However, under the escort of ruling Democratic Progressive Party (DPP) legislators, Premier Su delivered his policy address orally in just 22 seconds. The DPP also adjusted the procedural order such that the policy address was completed in chaos. The KMT caucus blasted the move as the "nastiest in history" and announced that it would suspend all negotiations with the DPP caucus. The ruling and opposition parties have fallen into deadlock despite the fact that a new session had only just opened in the Legislative Yuan. 
September 29: Fumio Kishida, the new president of Japan's ruling Liberal Democratic Party who formerly served as foreign minister and defense minister, will assume office as the 100th prime minister of Japan. Mr. Kishida previously welcomed Taiwan's participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and viewed Taiwan as an important economic partner to Japan. 
September 30: Five Taiwanese free divers went to Cyprus to participate in the World Championship. The organizer, International Association for the Development of Apnea (AIDA), removed the R.O.C. national flag on the broadcast screen without warning on September 28. Taiwan immediately expressed its protest and garnered the support from contestants from some 10 countries including Japan, taking the initiative to demand that the organizer remove its own national flag from the broadcast screen. AIDA issued a statement of apology on its official website on September 30, stating that it unilaterally decided to remove Taiwan's flag because the footage could not otherwise be broadcast in mainland China. 
October 1: Mainland China dispatched 38 military planes which entered Taiwan's air defense identification zone (ADIZ). Deputy Secretary of Defense Kathleen Hicks stated that the United States continues to closely monitor the situation and emphasized that it has strong capabilities in the region to contain potential threats from China. She also reiterated that the United States would maintain its commitments to Taiwan and assist Taiwan in improving self-defense capabilities, so as to change China's intimidation calculus.
Taiwan Weekly is a newsletter released every week by Fair Winds Foundation, Association of Foreign Relations, and Taipei Forum which provides coverage and perspectives on the latest developments in Taiwan.

The conclusions and recommendations of any Taiwan Weekly article are solely those of its author(s) and do not reflect the views of the institutions that publish the newsletter.

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