China tensions ‘serious’ challenge for chip industry, TSMC says

HSINCHU: Rising Taiwan-China and U.S.-China tensions have brought “more serious” challenges for the semiconductor industry, the chairman of Taiwanese chipmaker TSMC said on Wednesday.

Taiwan is a major producer of chips used in everything from cars, smartphones to data centres and fighter jets, while Taiwan Semiconductor Manufacturing Co Ltd (TSMC) is the world’s largest contract chipmaker and Asia’s most valuable listed firm.

While the chips sector is already bracing for waning demand as red-hot inflation squeezes spending, Taiwan faces a tougher situation – sandwiched between its largest export market China and its main international backer and arms supplier, the United States – especially as Beijing steps up military pressure to force Taipei to accept Chinese sovereignty claims.