‘Silicon shield,’ ‘Made with Taiwan’

• By Ming-yeh T. Rawnsley 蔡明燁

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Taiwan’s semiconductor industry gives other countries powerful reasons to prevent a conflict in the Taiwan Strait. It also gives them reasons to reduce their dependence on Taiwan. As production spreads, Taiwan needs a “silicon shield” that can adapt: one that keeps it central to the networks behind advanced technology while turning technological partnerships into durable political support.

This tension framed a podcast conversation with sociologist Wu Jieh-min (吳介民) for the NTNU International Taiwan Studies Center, in collaboration with the International Journal of Taiwan Studies. Wu, a distinguished research fellow at Academia Sinica, examines Taiwan’s technological position in Global Taiwan, published by Cambridge University Press this year.

The “silicon shield” rests on the idea that disrupting Taiwanese chip production would damage industries worldwide, encouraging other governments to deter aggression. Yet the same risk drives investment in alternative production. Taiwan must remain an indispensable partner without assuming that economic importance guarantees protection.

A shift from “Made in Taiwan” to “Made with Taiwan” captures the challenge: Taiwan must continue contributing essential knowledge, research and capabilities as production becomes more geographically dispersed.

Taiwan Semiconductor Manufacturing Co’s (TSMC) achievement illustrates why. A fabrication plant operates within a network of suppliers, engineers, research institutions and accumulated relationships. TSMC earned customers’ trust by manufacturing their chips without competing against their designs, and helped coordinate design tools and manufacturing expertise. A new factory cannot instantly reproduce that system.

Overseas expansion can deepen partnerships and create opportunities for upgrading. Its consequences depend on where research and engineering capabilities develop, how knowledge circulates, and how overseas operations connect to Taiwan’s industrial base.

Staying central requires more than protecting an existing advantage. Taiwan needs sustained investment in research and skills, international collaboration among universities, suppliers and firms, and the capacity to move into emerging technologies. Joint research, engineer exchanges and training can build these connections.

The value of the “silicon shield” changes as other countries adapt. Wu raises a difficult possibility: If China becomes less dependent on Taiwanese supplies, the economic damage of disruption could fall increasingly unevenly.

This is an argument about changing incentives, not a prediction that Beijing would choose war. Taiwan cannot rely indefinitely on the same distribution of economic costs to discourage aggression. The “silicon shield” must adapt to changing geopolitical, industrial and technological conditions.

At last year’s artificial intelligence and Taiwan studies forum, Wu proposed a “silicon shield 2.0” focused on Taiwan’s participation in supply chain governance and cooperation with democratic partners. “Made with Taiwan” gives that approach a practical direction: cultivate research partnerships and shared capabilities that remain valuable as production locations change.

Partners encouraging Taiwan to diversify production should explain how their policies bolster Taiwan’s resilience. An investment might deepen customer relationships without securing a diplomatic commitment. Supply chain security for importing countries cannot be assumed to provide security for Taiwan.

Taiwan’s right to determine its future should not depend on its market share. International interests in regional stability predate advanced semiconductors. Chips add to those interests; Taiwan’s democracy and its people deserve support even as production networks change.

Security arguments must account for semiconductor growth’s domestic costs. Wu examines demands on workers, land, water and electricity. High salaries coexist with intensive working practices, while expansion can provoke disputes over land acquisition and access to resources.

Calling the industry essential to national survival can make disputes harder to resolve fairly. Residents and workers might find their concerns subordinated to strategic urgency. Public pride in TSMC does not imply consent to every decision made in its name.

Consultation, environmental accountability and fair working conditions help sustain public support. Governments and companies must explain who benefits and who bears the burdens.

Before approving expansion, policymakers should ask how demand for power and water would affect other users, whether environmental assessments allow meaningful challenge and whether workers can raise concerns.

Taiwanese have shown that economic integration is subject to democratic judgement. The 2014 Sunflower Movement connected concerns about closer cross-Strait ties with demands for scrutiny and accountability. Wu’s analysis shows how campaigns for social reform and resistance to China’s encroachment have converged. Civil society remains divided, but its ability to challenge decisions gives Taiwan resources beyond corporate investment and formal diplomacy.

Wu’s public-opinion research also distinguishes support for the cross-Strait “status quo” from confidence that it would endure. Many respondents preferred present stability while expecting a different long-term outcome. Economic interdependence has not settled Taiwan’s security.

A credible strategy would assess semiconductor cooperation by Taiwan’s capacity to innovate, the support its partners provide and the legitimacy of decisions at home. “Made with Taiwan” should mean continued investment in research and talent, reciprocal partnerships and accountability over the costs of growth.

Taiwan’s technological success offers an opportunity to shape a changing global industry. A sustainable “silicon shield” depends on learning and adaptation, alongside political commitments that factories alone cannot supply. Its ultimate measure is whether Taiwanese gain greater freedom to decide their future.

Ming-yeh T. Rawnsley is a research associate at SOAS University of London’s Center for Taiwan Studies.