US would destroy chip factories in Taiwan to avoid Chinese conquest: advisers


Robert O’Brien, a former US national security adviser, told Semafor that China would be “like the new OPEC for silicon chips” if it invaded Taiwan and took over semiconductor factories.
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  • A former national security adviser said the US would “never” allow China to take possession of Taiwan’s semiconductor factories.
  • Robert O’Brien told Semafor that China could “control the world economy” with the factories.
  • TSMC is the world’s largest chip maker, powering most of the devices and equipment used every day.

A former national security adviser said the US would destroy Taiwan’s semiconductor factories if China came close to controlling them after an invasion.

Robert O’Brien, who served as national security adviser in the Trump administration, told Semafor the US “and its allies will never let these factories fall into Chinese hands.”

Taiwan Semiconductor Manufacturing Company is the world’s largest chip maker and accounts for an estimated 90% of the advanced processor market. The company produces chips for most of the devices and equipment that are used every day, such as phones and cars. More advanced chips from the manufacturer are used in advanced technologies such as machine learning and guided missiles.

If China took control of those factories, the country would be “like the new OPEC for silicon chips,” O’Brien said, adding that China would be able to “control the world economy.”

The former adviser compared the US destruction of factories to when British Prime Minister Winston Churchill ordered the destruction of the French naval fleet during World War II after France surrendered to Germany, Semafor said.

Neither O’Brien nor TSMC immediately responded to requests for comment from insiders.

Apple is TSMC’s largest customer, and the manufacturer produces most of the world’s 1.4 billion smartphone processors. Around 60% of automakers are also reportedly using the company’s chips.

Although much of the research and development for semiconductors occurs in the US, over the past 30 years manufacturers have decided it’s best to outsource manufacturing, William told Alan Reinsch, senior advisor at the Center for Strategic and International Studies Insider.

“They build a big factory and crank these things by the thousands in a low-wage, non-union country that probably has no environmental regulations,” Reinsch said. “You keep all the design and intellectual property at home, and you do all the sales, marketing and service at home, and that’s where you make the money.”

O’Brien is not the first to raise the idea of ​​destroying Taiwan’s semiconductor factories if China successfully invades. Two US scientists recommended the move in a paper published by the US Army War College in 2021.

“First, the United States and Taiwan should develop plans for a targeted scorched-earth strategy that would not only make Taiwan unattractive if it were ever conquered by force, but would also be costly to maintain,” the paper said. “This could be done most effectively by threatening to destroy facilities at Taiwan Semiconductor Manufacturing Company, the world’s top chip maker and China’s top supplier. South Korea-based Samsung (an ally of the US) is the only alternative to cutting edge designs.”

But Chen Ming-tong, director-general of Taiwan’s National Security Bureau, said it was unnecessary for the US to destroy Taiwan’s semiconductor factories in the event of an invasion because the system was already deeply integrated into the global supply chain. This means production can be shut down by the US and other countries without physically destroying factories.

For example, TSMC cannot produce certain chips without components from Dutch supplier ASML, Chen said. “Even if China gets its hands on the golden hen, it will not be able to lay golden eggs,” Chen said.

As tensions between mainland China and Taiwan continue to escalate, analysts are predicting a Chinese invasion of the island in the next few years. If China invades Taiwan, “it would be the biggest impact we’ve ever seen on the global economy,” Glenn O’Donnell, vice president and head of research at Forrester, previously told Insider, adding that it could be worse than the stock market crash 1929

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