Taiwan is an essential part of the world for one reason; it produces roughly 90% of its semiconductor microchips. And because of that, a former national security advisor who served under Donald Trump made a startling claim about the lengths the United States would go to make sure China doesn’t gain control of the factories that produce the semiconductors.
Robert O’Brien was quoted by a publication called Semafor and said that the US and allies “are never going to let those factories fall into Chinese hands.”
More specifically, O’Brien said our military would destroy the factories on the island of Taiwan before we’d allow China to take them over if they were to invade.
It’s mind-boggling to consider how dominant Taiwan and specifically Taiwan Semiconductor Manufacturing Company is when manufacturing this essential chip. They essentially make all the chips used in phones and cars daily. They also produce more advanced chips used in weapons.
O’Brien compared a potential Chinese invasion and the ramifications of them taking over the TSMC factories in a way that proves his point. China would be “like the new OPEC of silicon chips.”
The outcome would be China controlling the world economy.
The biggest customer of TSMC is Apple — and their factories are responsible for the ingredients needed to build the 1.4 billion smartphone processors in the world.
The United States has led the way regarding semiconductor research and development — our brainpower has created them. But it’s much cheaper to build them outside the US. Here’s what William Aland Reinsch of the Center for Strategic and International Studies told Insider.
“You build a big factory, and you crank these things out by the thousands, and you do it in a low-wage, nonunion country that probably doesn’t have environmental requirements. You keep all the design and IP at home and you do all your sales, marketing, and service at home, and that’s where you make the money.”
Tensions between China and Taiwan are high. It’s essential that they don’t escalate because the entire world’s economy would be affected.
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