The path to sustain the nation's semiconductor industry is cross-sector collaboration and application, early exploration of new fields, and moving out of contract manufacturing toward diverse, small-quantity yet systemic production (a guideline of Productivity 4.0) to create "complete" products (as opposed to components), Premier Mao Chi-kuo stated today.
Taiwan lacks natural resources and requires massive commodity imports and expansionary exports to achieve economic growth, Mao pointed out. In formulating industrial policy, the government understands that products or services at the supply end, including all wearable devices or services applications, are based on integrated circuit (IC) technology. How to sustain Taiwan's edge in the global IC industry can thus be regarded as a national security problem, the premier noted.
In the past the industrial chain was long, like a dragon in the traditional Chinese dragon dance, Mao remarked. Given the advancement toward the innovation field where the Internet of Things is the core, however, in the future the industrial chain must become short and compact, like a lion in the Chinese lion dance. The government has already initiated industrial integration through various policies and measures.
The premier made these remarks after he was briefed by the Ministry of Economic Affairs (MOEA) on measures to consolidate the competitiveness of the semiconductor industry, which ranks foremost among Taiwan's backbone industries, accounting for 12.16 percent of overall industrial production value and 23.36 percent of total exports. The global semiconductor market's slackened growth momentum in 2015 and competitive pressure from South Korea and mainland China in wafer-chip contract manufacturing and IC designs, respectively, as well as in other related fields, have led the sector to encounter developmental bottlenecks in terms of competitiveness, applications, technology, laws and regulations, and talent.
To consolidate the industry's global competitiveness, the government will encourage cross-sector integration; develop new and emerging applications and key technologies; open up the country to further investment, mergers and deregulations; and provide incentives for domestic talent retention and overseas recruitment.
The MOEA's current course of action is to implement the existent smart electronics industry promotion program. The ministry's short-term consolidating measures will encompass collaboration with international brands, establishment of a platform for innovative applications, and a promotion plan for integration and applications of semiconductors and key components. The MOEA will also assist upstream and downstream businesses to integrate so as to make inroads into international markets.