TSMC 12-inch wafer plant in China could be OK’d before CNY

The China Post news staff

TAIPEI, Taiwan–The world’s largest contract chip-maker Taiwan Semiconductor Manufacturing Co.’s (TSMC) application to set up a 12-inch wafer plant and a design service center in mainland China will likely be green-lighted before Chinese News Years rolls around, reports stated on Monday.

The proposed project, which needs to undergo examinations by the Ministry of Economic Affairs (MOEA, 經濟部), is expected to be on the table for discussions by the Investment Commission (投審會) under the MOEA next week. Reports stated that a MOEA-led key task-force report will be rounded up as well, Chinese-language United Evening News stated.

The TSMC investment proposal to move into China serves as a benchmark — it’s one of the projects up for discussion during the new Legislature and government handover. It will also shed light on how the upcoming Democratic Progressive Party (DPP)-ruled government would handle related cases, as TSMC is also an indicator enterprise in Taiwan, reports said.

According to the MOEA, the application was filed with the Investment Commission late last year, and was expected to be followed up with two months of inspections. However, due to thus-far smooth processing of the application, the MOEA will include the report, led by the Industrial Development Bureau, in its committee discussions next week.

An Industrial Development Bureau official, speaking to local media, stated that current inspections are concentrated on indicators such as investment levels, technical know-how of engineers, competency of workforce and potential of the project to stimulate developments in Taiwan’s upstream and downstream component enterprises. A key turning point will be seen in 2018, the official stated, when the Bureau plans to send out people to conduct surveys on the company’s progress.

However, MOEA officials stated that the proposal would not require Legislature or Cabinet approval, refuting previous claims that MOEA wished to roll out the project before the new Legislature convenes. The official also pointed out that the DPP has maintained a particularly positive attitude toward the TSMC’s project in China, in compared to the backlash brought on by China’s Tsinghua Unigroup’s (紫光) previous investment bids in Taiwan. Domestic IC Growth Slows

However, the Economics Ministry’s Department of Statistics (統計處) showed that while Taiwan’s integrated circuit (IC) industry has been growing steady, its projected growth rate for 2016 is in the single digits, down from double-digit growth in 2015.

The MOEA also pointed out that last year’s data showed Taiwan’s DRAM industry growth value has gone into the negative. Coupled with the decline in foundry production, the IC industry saw annual growth of only 6.2 percent in 2015.

The market originally saw a surge in the first half of 2015, yet due to the worldwide economic slump, especially in emerging markets where demands for consumer electronics went down, the second half of 2015 saw a decline to 7.9 percent.