Apple chipmaker TSMC invests in Japanese manufacturing as Taiwanese stability concerns rise

Apple chip maker TSMC is one of seven semiconductor companies that announced plans to invest in Japanese enterprises ahead of the G7 summit in the country.

One of the key issues to be discussed at the summit is economic resilience and security in the face of growing threats to global trade, including worries about the future of Taiwan …

Threat to Taiwan

All Apple processors are manufactured by Taiwan Semiconductor Manufacturing Company (TSMC), so the state of the Californian company is closely related to the political and economic stability of the country.

While Taiwan considers an independent nation – with its own constitution, elections, passport, currency, and military—the Chinese government views the island as its own territory.

The global reaction to Russia's invasion of Ukraine has shown China that while it may face economic risks in invading Taiwan, it is unlikely will face military risks due to fears that this could spark a nuclear war.

Even China. rehearsed the blockade in August last year. US military advisers then said that the short-term risk is low, but the medium-term and long-term prospects for Taiwan are disappointing.

We learned this week that Warren Buffett's conglomerate Berkshire Hathaway sold  all of his TSMC shares in what has been described as a “jumpy” move. He said this was due to concerns about the location, not the company, and specifically mentioned Japan as a safer investment opportunity.

TSMC invests in Japanese facilities

The Financial Times reports that TSMC has agreed to build a new plant in Japan and said more may follow.

Seven of the world's largest semiconductor makers have laid out plans to increase production and deepen technology partnerships in Japan as Western allies step up efforts to reshape the global chip supply chain amid rising tensions with China [& #8230;]

The US has sent significant diplomatic capital to urge its allies in the region to unite more closely against the perceived threat of China's rising technological and military power, and to reduce reliance on TSMC's chips. and others in Taiwan.

TSMC, the world's largest contract chip manufacturer, also announced the possibility of increasing investment in Japan after agreeing to build a new factory in southwestern Kumamoto Prefecture.

Photo: Simon Laney/Unsplash

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