Brexit, Supply Chains and the Contest for Supremacy: The Case of Taiwan and the Semiconductor Industry

Robyn Klingler-Vidra, Yu Ching KUO

Research output: Chapter in Book/Report/Conference proceedingOther chapter contribution

Abstract

The chapter explores how Brexit could undermine or boost Taiwan’s semiconductor industry. The focus on Taiwan-Europe relations with respect to the semiconductor industry stands to make a contribution to political economy literature. Scholarship on Taiwan’s industrial upgrading, high-technology industry advances and venture capital
market growth have focused squarely on the “bridge” to Silicon Valley. Numerous studies have detailed how Taiwan’s “New Argonauts” travelled between California and Hsinchu Park, establishing connections that drove technology transfer (initially from RCA to Taiwan), investment, and an upgrading of the talent pool in Hsinchu Park. Much less has been written on the topic of the interactions between Taiwanese tech and Europe, and even less on the UK-Taiwan semiconductor connections. This has left a gap in our understanding, and one that is important to fill given contemporary
trends that collectively constitute marked uncertainty about trade openness.

The chapter’s second core focus is the impact of the US-China trade war on Taiwan’s semiconductor industry. In doing so, we offer a sector specific account of the trade war, to complement Bob Wang’s chapter on the US political response to the escalations. Companies on both the US and Chinese side of the dispute have spoken of reducing exposure to one another. For the Americans, this means moving out of China, with announcements of establishing or increasing operations in Taiwan, as well
as India and Vietnam.5 While for the Chinese side, this involves a “de-Americanization” strategy.6 Both countries could increase their business with the Taiwanese semiconductor industry. On account of the industry’s massive contribution to the local economy, this would be a boon for the island as a whole.

The following section sets the scene for the analysis, with an overview of the global semiconductor industry, and the stature of the various countries in this key industry. The chapter then interrogates, in turn, ways in which realization and escalation of Brexit and the US-China trade war could affect the industry, particularly in Taiwan. We close with brief concluding remarks on the potential effects of the rising uncertainty on semiconductors.
Original languageEnglish
Title of host publicationA New Beginning or More of the Same? The European Union and East Asia After Brexit
PublisherPalgrave Macmillan Ltd.
Chapter8
Pages183-203
Publication statusPublished - 5 Feb 2021

Keywords

  • Brexit
  • SEMICONDUCTORS
  • TAIWAN

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