In Taiwan, the government has just taken a defensive stance with regard to the situation of TSMC and its future operations in the USA and elsewhere. A draft law is being prepared and should be approved by the end of the year. This simply requires that cutting-edge technologies remain exclusively located on the Island. As a result, TSMC ‘s manufacturing sites abroad should not be allowed to have access to the latest manufacturing processes.
Silicon Shield: the rule Taiwan wants to preserve to protect itself.
Until now, the Silicon Shield theory was the only rule observed by the local authorities with regard to TSMC. For the record, this “silicon shield” philosophy suggests that Taiwan’ s central role in the global semiconductor supply chain is a deterrent to Chinese aggression. If the USA now demands that the best factories be located there, this philosophy becomes more fragile. Taiwan’s reaction can be explained in this light.
We do not know whether the government’s position is definitive or whether it is part of a poker game with the US administration. However, the main idea is that a TSMC plant abroad will only be able to operate the N+1 node at best. This means that TSMC foundries outside Taiwan will always have to be at least one process behind peak production in Taiwan. If we take the logic of the project to its logical conclusion, the export of new technologies could even be banned. Worse still, it should be kept in mind that the time between the transition from one generation of process to another is tending to increase.
