TSMC founder: Globalisation in technology takes backseat to national priorities

[Daniel Nenni]

Morris Chang, the founder of the Taiwan Semiconductor Manufacturing Company (TSMC), attends a Chip War book event in Taipei

TAIPEI (Reuters) - Globalisation is taking a backseat to priorities such as national security and technological leadership, with U.S.-China relations consisting more of competition than cooperation, the retired founder of Taiwanese chipmaker TSMC said on Tuesday.

Morris Chang, who founded the world's largest contract chipmaker Taiwan Semiconductor Manufacturing Co Ltd (TSMC), said globalisation has been redefined as allowing businesses to move across borders only under the condition that such exchanges do not harm national security, technological supremacy and economic leadership.

"But can this still be considered globalisation?" Chang said at a business forum in Taipei.

Chang's comments come a day after China said it would control exports of some metals widely used in the semiconductor, communications and defence industries, the latest salvo in a trade war between Beijing and the United States over access to high-tech microchips.

Chang, who at 91 remains an influential voice in the chip industry, said globalisation peaked in the 2010s and has weakened over the past several years as the U.S. and China adopt measures to boost their domestic chip industries.

He has previously declared that globalisation in the chip sector dead.

TSMC, Asia's most valuable listed company, is referred to in Taiwan as the "sacred mountain protecting the country" because of its economic importance.

While TSMC has said its most advanced manufacturing will remain on the island, the company has ramped up expansion abroad in recent years.

The company's dominance in making some of the most advanced chips for high-end customers such as Apple has shielded it from a broader industry downturn.

China has in recent years increased diplomatic and military pressure against Taiwan, raising concerns about the fate of the factories that dot its western coast and produce the majority of the world's most advanced chips.

Beijing views democratically governed Taiwan as its own territory, a claim the government in Taipei strongly rejects.

TSMC founder: Globalisation in technology takes backseat to national priorities

Globalisation is taking a backseat to priorities such as national security and technological leadership, with U.S.-China relations consisting more of competition than cooperation, the retired founder of Taiwanese chipmaker TSMC said on Tuesday. Morris Chang, who founded the world's largest...

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[Tanj]

Which other company of such global reach did not take care to establish regional footprints long, long ago? For TSMC to think that now is special just reflects their past obliviousness. Their Taiwan exceptionalism culture had advantages to them, but the position they are in now is one that other companies anticipated much earlier in their growth.

 

[Tanj]

Globalization is not synonymous with choke points in supply chains. You can just as validly see globalization as having diverse regional supply chains, along with an effective system for IP rights.

The use of choke points in the supply chain for political power, in various directions, is an ancient game and globalization should not imagine it magically ended. Better to construct business relationships and chains which are fault tolerant. Heck, never mind politics, there are also floods, fires, earthquakes, droughts, pandemics, bad management, technology snafus, strikes .. about time the MBA had the equivalent of Black-Scholes built into supply chain pricing calculations, which would reveal the need for more investment in backup plans.

 

[Xebec]

I’d love to hear him elaborate in more detail about what he thinks is going on, what the impacts are, and what “we” should be doing instead.

Scanning his bio, he certainly saw a series of world changing events as a child and young adult that would lend very interesting perspective.

 

[Daniel Nenni]

It really isn't that complicated in my opinion. Morris structured TSMC to be customer driven and that now requires globalization. He could not have seen that coming. The good news is that TSMC has some really big and powerful customers. The bad news is that TSMC has some really big and powerful customers.