In a speech at the Chongyang Institute for Financial Studies at Renmin University in China, Chinese economist Chen Wenling spoke about what China should do if the United States imposed sanctions on China similar to those imposed on Russia. It seems that TSMC, the Taiwanese processor manufacturer, could be the key to China’s response to such a threat, as most US technology companies rely on TSMC for component production.
TSMC is an important target for China in the event of a conflict with the United States
Chen Wenling argues that tensions between China and the United States should end, as a confrontation between the two powers could be disastrous for humanity. However, Wenling says the United States wants to isolate China by trying to establish the Trans-Pacific Partnership and the Trans-Atlantic Trade and Investment Partnership, which were designed as anti-Chinese institutions. The United States withdrew from the first, but the second was canceled, according to The Register.
As the US wants to “break” China’s supply chain, the Chinese economist suggests that steps should be taken to ensure that this does not happen. If the United States imposes sanctions similar to those imposed on Russia, China should “reclaim Taiwan” and seize TSMC, “a company that originally belonged to China,” according to Cheng Wenling.
He is concerned that TSMC is preparing to open processor factories in the United States, which would allow the full transfer of technology that the Taiwanese company owns to the United States. Consequently, China should not allow this to happen.
Taiwan could destroy processor factories in the event of an invasion
However, the scenario in which the US or the West would impose sanctions on China would only appear in the event of an event similar to the one in Russia. An invasion of Taiwan could probably be the only reason for such actions. In fact, an invasion by China to seize TSMC could result in the destruction of the company’s factories. The US military has proposed to the Taiwanese government to sabotage factories in such situations. Thus, China would no longer be able to seize those factories, nor would it be able to buy chips, as it currently does.
Taiwan currently has 48% of the world’s processor factories, and 61% of the production capacity of 16nm architecture processors. Meanwhile, China produces only 1/6 of the chips that the country’s industries use.
source: The Register