TAIPEI (Realist English). When it comes to semiconductors, China needs Taiwan more than the other way around, the CNBC article notes. Beijing halted some trade with the island this month after the U.S. House Speaker Nancy Pelosi’s provocative trip to Taiwan.
According to a 2021 Boston Consulting Group report Taiwan is home to more than 90% of the manufacturing capacity for the world’s most advanced semiconductors.
Pelosi’s visit included a visitation of the Taiwan Semiconductor Manufacturing Company (TSMC). It is the largest and most important chip manufacturer in the world. The products of the Taiwanese company are an integral part of everything from consumer goods to military aircraft.
According to the company, only 10% of revenue comes from China, and more than half of TSMC’s revenue comes from sales of chips in the United States.
Analysts emphasize that Taiwanese-made chips, especially TSMC, are too important for the whole world and China.
“If you look at the secular demand drivers, cloud infrastructure, electric vehicles, next generation of industrial facilities, they all require chips that are made at TSMC,” said Mehdi Hosseini, senior tech hardware analyst at Susquehanna. “If, God forbid, TSMC’s fabs in Taiwan cannot operate, I think the global economy would slow down more so than what COVID did [to growth],” he said.
