Politico: After crossing with China, Lithuania gains an advantage in a significant Taiwanese industry
The provoked clash with China’s move towards Taiwan could turn into an unexpected success. For a small Baltic country, France or Germany could only dream of it: we have to talk about investing in the production of microchips.
Europe is known to be lagging far behind in the critical semiconductor industry, and the key element in the EU’s strategy to ensure Europe’s survival in the major economic leagues, alongside industry rivals such as China and the US, is the ambitions associated with chip production. Although EU leaders have sought to work with major Asian (and democratic) players in the electronics sector, such as Taiwan and South Korea, the results have so far been confirmed, Politico said.
However, it seems that a break from the stalemate may arise, as the fierce trade dispute between Lithuania and China has turned Vilnius and Taipei into a rather geopolitical tandem – a kind of David united against Goliath in Beijing. As diplomatic relations between Lithuania and Taiwan began to improve, China issued a strict emblem to the Baltic state – boycotting not only goods exported from the country, but also products sent from other EU countries if at least one Lithuanian component was incorporated into them.
To ease its share of Europe’s most loyal ally, Taiwan has announced a plan worth $ 200 million. investments (EUR 176.7 million). This opened up the prospect of cooperation in the production of chips.
Taiwan’s plans to invest in Lithuania have not yet been approved: they will have to be analyzed by Taiwanese experts over the next few months. However, in an interview with the Politico portal, a high-ranking Taiwanese diplomat visiting Vilnius stated that all possibilities are considered, so Lithuania can show a breakthrough to the remaining participants in the European semiconductor market.
“This is the first time the Taiwanese government has set up such an investment fund,” said Eric Huang, head of the Taiwanese mission in Vilnius. “When analyzing the investment in semiconductors in Lithuania, we will take into account the entire context of the European Union market, as this would ensure greater compatibility and profitability.”
Powerful friends
Even a hint of a partnership with such a powerful leader as Taiwan impresses. Taiwan’s Semiconductor Manufacturing Company (TSMC), which accounted for as much as 54 percent of global output revenue, many other governments press to diversify production. However, so far Taiwan has been cautious about the proposals, and could get chips to supply strategic partners such as the United States and Japan, countries that could help the island defend itself in the event of war.
The lack of chips, especially in the wake of the coronavirus pandemic, is a headache for Europe, with production bastions such as Germany in decline in both the automotive and similar sectors.
The decisive factor was the rather modest amount of money needed. The investment proposed by Taiwan is a drop in the ocean, along with the money that a fully operational plant would require. For example, the TSMC plant in Arizona, which will be operational by 2024, will require $ 12 billion. years of investment.
Politico writes that the representative of the European Commission questioned Lithuania’s financial and logistical possibilities to operate such facilities: he emphasized the emphasis on cheap electricity and water supply in large quantities.
Mr Huang acknowledged that it would be difficult for any EU country to replicate Taiwan’s model of managing the entire supply chain needed to manufacture microchips in the last four decades, by its own efforts alone.
According to him, individual countries should take care of strengthening specific aspects of the system, and Taiwan has promised to help Lithuania focus on one of the most important areas – training of talented personnel.
“Taiwan is playing its economic card wisely,” said Mathieu Duchatel, director of the Asia program at the Montaigne Institute in Paris. – It is clear that Taiwan can offer something concrete, that the European semiconductor ecosystem has been strengthened, and its message alludes to the international deepening of its space. Consequently, it is a kind of economic way of building a state. “
Minister of the National Development Council of Taiwan Kung Ming-hsin, also joining the TSMC Board, met with his Lithuanian counterpart, Minister of Economy and Innovation Aušrine Armonaitė, on Tuesday.
Intensive Activity Week
Politico says an informal meeting of foreign ministers from all EU member states is scheduled to take place in Brest, a port city in western France, just after the meeting. The issue of EU-China relations is identified as an important item on the agenda of the meeting.
According to diplomats, the meeting should focus on the three-day Olympic Games in Beijing. The fact is that EU countries are feeling the general pressure to announce their intention to join the diplomatic boycott of the United States, Britain and other countries over China’s approach to human rights.
“It is unlikely that a common position will be adopted, as some countries, such as Belgium and Austria, have already ruled out official representation, and France must send something because it will have to host the Olympics next year,” one diplomat explained. “However, a separate position would be well coordinated.”
According to the EU diplomat, two diplomats who have recently joined the EU foreign ministers – Annalena Baerbock from Germany and her Czech colleague Jan Lipavsky – are likely to join the group of skeptics in China, to whom Gabrielius Landsbergis, who is known to represent Lithuania, belongs.
Mr Baerbock has recently called on the EU as a whole to ban it as a result of forced labor, a reminder of concerns about products made in Xinjiang, a region where Islamic Uighurs are being massively oppressed. Mr Lipavsky, a diplomat who rose dramatically a few weeks ago and was initially rejected by Beijing-friendly President Milos Zeman, is a former member of the Interparliamentary Union on China, militant against the Beijing International Group.
However, no country can get as close to Taiwan – and closer to its chips – as Lithuania.
“Because Taiwan has extensive experience in semiconductor manufacturing, our primary responsibility is to help a friendly state take its competitive advantage seriously and fairly,” Huang said.
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