The war game scenario conducted by a Washington think tank began with a sudden failure at three Taiwanese semiconductor foundries that make high-end computer chips used in such items as smartphones, automobiles and military equipment.

The halt in production raised questions of whether a cyberattack by Beijing was responsible — touching off an international crisis between China and the United States that the researchers said could grind the global economy to a halt and incite a military confrontation.

The war game and study by the Center for a New American Security, which is set to be released Thursday, illustrate how dependent the world is on Taiwanese computer chips — and how that dependence could draw the United States and China into various kinds of conflict.

The report comes as Congress has put new energy into bills to increase domestic production of semiconductors in the United States. Diversifying the global supply chain for computer chips is a key recommendation in the report.

Last week, President Joe Biden urged Congress to pass those bills and promised he would work to bring production of semiconductor chips back to the United States.

“Today we barely produce 10 per cent&nbsp;of the computer chips, despite being the leader in chip design and research,” Biden said. “And we don’t have the ability to make the most advanced chips now — right now. But today, 75% of production takes place in East Asia. Ninety per cent of the most advanced chips are made in Taiwan. China is doing everything it can to take over the global market so they can try to outcompete the rest of us and have a lot of applications — including military applications.”

Even if Congress approves new government investments in America’s microchip production capacities, matching Taiwanese expertise is years away, if it is even possible, the report’s authors say. The United States is already more dependent on Taiwan’s high-end microchips than it was on Middle Eastern oil in decades past, the report said.

China, the war game predicts, could use economic coercion, cyber operations and hybrid tactics to try to seize or harm Taiwan’s semiconductor industry — and the United States must become better able to identify and counter Chinese tactics that could threaten the microchip supply.

War games like this one involve current and former officials, academics and other experts sitting around a table playing various roles. After an initial scenario is presented, the teams take turns making strategic decisions. Such exercises are supposed to yield insights about how different players would act and lay plain what sort of moves each group might make.

Becca Wasser, who helped design and lead the scenario, said while many war games were conducted to study China, most focus on conventional military threats, giving short shrift to the many ways China could exert pressure on Taiwan.

And countering those pressure points is difficult, especially if the United States and Taiwan are at odds over the best strategy. In the scenario, the US&nbsp;team presumed the Taiwan team would go along with its strategies to counter China. But Taiwan’s interest sometimes led it to cross-purposes. For example, when the United States wanted to bring semiconductor engineers to the safety of America, Taiwan resisted, worried about a brain drain.

“Whatever the United States tried to do by itself in the game really fell flat,” Wasser said. “We have seen a variety of examples of that in real life.”

As a result, multilateral responses and global efforts to build resiliency in the supply chain for computer chips are most likely the best strategy, the report said.

Taiwan has relied on its dominance of the microchip industry for its defence. The “silicon shield” theory argued that because its semiconductor industry is so important to Chinese manufacturing and the US&nbsp;consumer economy, actions that threaten its foundries would be too risky.

Martijn Rasser, a co-author of the study and a former CIA analyst, said it was crucial for the international community to persuade Taiwan that its shield strategy needed to be internationalized. “The long-term play has to be a geographic dispersal of those capabilities out of Taiwan in exchange for enhanced security guarantees for the island,” he said.

The Biden administration has made clear that in the case of Ukraine, while the United States would economically punish Russia for any invasion, it would not commit troops to fight alongside Kyiv to stop any intervention by Moscow. The long-standing US&nbsp;policy toward Taiwan calls for shoring up its defences and practicing strategic ambiguity over whether Washington would militarily intervene in a conflict over the island.

But Taiwan and its semiconductors are far more important to America’s economy than Ukraine is — meaning it would very likely be far more difficult for the United States to stay out of a conflict involving Taiwan.

Taiwan accounts for half of the overall production of microchips that are critical to the functioning of mobile phones, consumer electronics, cars, military equipment and more. South Korea, the nearest competitor, has about 17% of the overall market. But Taiwanese chips are the smallest and fastest, and its foundries account for 92% of the most advanced designs.

“It’s almost impossible to duplicate Taiwan’s manufacturing capability of high-end chips, of low-end chips,” said Dan Blumenthal, a scholar at the American Enterprise Institute. “It’s just the manufacturing hub of the world.”

Although the United States and Europe are trying to boost their own domestic design and production of semiconductors, they do not have the abilities to mass produce the most advanced designs that the Taiwan Semiconductor Manufacturing Company can make.

“If the semiconductor supply chain is infringed upon by China in some way, all of the sudden the things that Americans look to in their daily lives, to get to and from work, to call their loved ones, to do a variety of different things, those disappear,” Wasser said.

Other experts said it would be an overstatement to say that the United States would be dragged into a war over microchips. China would decide what kinds of coercive measures it would take against the Taiwanese based on the perceived threat to its sovereignty and the expected international backlog, said Bonny Lin of the Center for Strategic and International Studies.

“China is not going to base their Taiwan policy, or any decision to use force against Taiwan, based on chips,” Lin said. “China thinks about the costs of an invasion of Taiwan -&nbsp;there are significant political and military costs. That is why I don’t think chips would figure among the top three factors of using military force against Taiwan.”

The war game scenario conducted by a Washington think tank began with a sudden failure at three Taiwanese semiconductor foundries that make high-end computer chips used in such items as smartphones, automobiles and military equipment.

The war game scenario conducted by a Washington think tank began with a sudden failure at three Taiwanese semiconductor foundries that make high-end computer chips used in such items as smartphones, automobiles and military equipment. The halt in production raised questions of whether a cyberattack by Beijing was responsible — touching off an international crisis between China and the United States that the researchers said could grind the global economy to a halt and incite a military confrontation. The war game and study by the Center for a New American Security, which is set to be released Thursday, illustrate how dependent the world is on Taiwanese computer chips — and how that dependence could draw the United States and China into various kinds of conflict. The report comes as Congress has put new energy into bills to increase domestic production of semiconductors in the United States. Diversifying the global supply chain for computer chips is a key recommendation in the report. Last week, President Joe Biden urged Congress to pass those bills and promised he would work to bring production of semiconductor chips back to the United States. “Today we barely produce 10 per cent of the computer chips, despite being the leader in chip design and research,” Biden said. “And we don’t have the ability to make the most advanced chips now — right now. But today, 75% of production takes place in East Asia. Ninety per cent of the most advanced chips are made in Taiwan. China is doing everything it can to take over the global market so they can try to outcompete the rest of us and have a lot of applications — including military applications.” Even if Congress approves new government investments in America’s microchip production capacities, matching Taiwanese expertise is years away, if it is even possible, the report’s authors say. The United States is already more dependent on Taiwan’s high-end microchips than it was on Middle Eastern oil in decades past, the report said. China, the war game predicts, could use economic coercion, cyber operations and hybrid tactics to try to seize or harm Taiwan’s semiconductor industry — and the United States must become better able to identify and counter Chinese tactics that could threaten the microchip supply. War games like this one involve current and former officials, academics and other experts sitting around a table playing various roles. After an initial scenario is presented, the teams take turns making strategic decisions. Such exercises are supposed to yield insights about how different players would act and lay plain what sort of moves each group might make. Becca Wasser, who helped design and lead the scenario, said while many war games were conducted to study China, most focus on conventional military threats, giving short shrift to the many ways China could exert pressure on Taiwan. And countering those pressure points is difficult, especially if the United States and Taiwan are at odds over the best strategy. In the scenario, the US team presumed the Taiwan team would go along with its strategies to counter China. But Taiwan’s interest sometimes led it to cross-purposes. For example, when the United States wanted to bring semiconductor engineers to the safety of America, Taiwan resisted, worried about a brain drain. “Whatever the United States tried to do by itself in the game really fell flat,” Wasser said. “We have seen a variety of examples of that in real life.” As a result, multilateral responses and global efforts to build resiliency in the supply chain for computer chips are most likely the best strategy, the report said. Taiwan has relied on its dominance of the microchip industry for its defence. The “silicon shield” theory argued that because its semiconductor industry is so important to Chinese manufacturing and the US consumer economy, actions that threaten its foundries would be too risky. Martijn Rasser, a co-author of the study and a former CIA analyst, said it was crucial for the international community to persuade Taiwan that its shield strategy needed to be internationalized. “The long-term play has to be a geographic dispersal of those capabilities out of Taiwan in exchange for enhanced security guarantees for the island,” he said. The Biden administration has made clear that in the case of Ukraine, while the United States would economically punish Russia for any invasion, it would not commit troops to fight alongside Kyiv to stop any intervention by Moscow. The long-standing US policy toward Taiwan calls for shoring up its defences and practicing strategic ambiguity over whether Washington would militarily intervene in a conflict over the island. But Taiwan and its semiconductors are far more important to America’s economy than Ukraine is — meaning it would very likely be far more difficult for the United States to stay out of a conflict involving Taiwan. Taiwan accounts for half of the overall production of microchips that are critical to the functioning of mobile phones, consumer electronics, cars, military equipment and more. South Korea, the nearest competitor, has about 17% of the overall market. But Taiwanese chips are the smallest and fastest, and its foundries account for 92% of the most advanced designs. “It’s almost impossible to duplicate Taiwan’s manufacturing capability of high-end chips, of low-end chips,” said Dan Blumenthal, a scholar at the American Enterprise Institute. “It’s just the manufacturing hub of the world.” Although the United States and Europe are trying to boost their own domestic design and production of semiconductors, they do not have the abilities to mass produce the most advanced designs that the Taiwan Semiconductor Manufacturing Company can make. “If the semiconductor supply chain is infringed upon by China in some way, all of the sudden the things that Americans look to in their daily lives, to get to and from work, to call their loved ones, to do a variety of different things, those disappear,” Wasser said. Other experts said it would be an overstatement to say that the United States would be dragged into a war over microchips. China would decide what kinds of coercive measures it would take against the Taiwanese based on the perceived threat to its sovereignty and the expected international backlog, said Bonny Lin of the Center for Strategic and International Studies. “China is not going to base their Taiwan policy, or any decision to use force against Taiwan, based on chips,” Lin said. “China thinks about the costs of an invasion of Taiwan - there are significant political and military costs. That is why I don’t think chips would figure among the top three factors of using military force against Taiwan.”

How computer chip shortage could incite US conflict with China

Taiwan has told staffing companies to remove all listings for jobs in China, a drastic move to prevent the outflow of vital tech talent to the mainland amid rising tensions between Taipei and Beijing.

The Labor Ministry said that all Taiwanese and foreign staffing companies on the island as a general rule may no longer post openings for jobs located in China, especially those involving critical industries such as integrated circuits and semiconductors, according to a notice seen by Nikkei Asia. 
 
Also read|&nbsp;<a href="https://www.wionews.com/world/taiwans-chip-firms-to-adhere-to-new-us-rules-blacklisting-chinese-entities-377434">Taiwan's chip firms to adhere to new US rules blacklisting Chinese entities</a>

Taiwan government has asked the companies to remove all recruitment listings for jobs in China, to prevent the outflow of vital tech talent to the mainland.

According to a notice seen by Nikkei Asia, the Labor Ministry said that all Taiwanese and foreign staffing companies on the island as a general rule may no longer post openings for jobs located in China, especially those involving critical industries such as integrated circuits and semiconductors.

Taiwan's government on April 28th accused China of waging economic warfare against the Chinese-claimed island's tech sector by stealing technology and enticing away engineers, as parliament considers strengthening legislation to prevent this.

Taiwan is home to a thriving and world-leading semiconductor industry, used in everything from fighter jets to cars, and the government has long worried about China's efforts to copy that success, including by industrial espionage and other underhand methods.

Four Taiwanese lawmakers from the ruling Democratic Progressive Party are leading a proposal to amend the commercial secrets law to widen the scope of what is considered a secret and toughen penalties.

Taiwan's Economy Ministry, in its report, said China was trying to boost its semiconductor industry by "poaching" Taiwanese talent "as well as obtaining our country's industry's commercial secrets, to harm the country's competitiveness".

In recent weeks, China has increased military pressure on Taiwan by conducting aircraft carrier drills near the island. China claims Taiwan as its territory and has historically not shied from advocating taking it by force.

(With inputs from agencies)

Taiwan has told staffing companies to remove all listings for jobs in China, a drastic move to prevent the outflow of vital tech talent to the mainland amid rising tensions between Taipei and Beijing.

Taiwan has told staffing companies to remove all listings for jobs in China, a drastic move to prevent the outflow of vital tech talent to the mainland amid rising tensions between Taipei and Beijing. The Labor Ministry said that all Taiwanese and foreign staffing companies on the island as a general rule may no longer post openings for jobs located in China, especially those involving critical industries such as integrated circuits and semiconductors, according to a notice seen by Nikkei Asia. Also read| Taiwan's chip firms to adhere to new US rules blacklisting Chinese entities Taiwan government has asked the companies to remove all recruitment listings for jobs in China, to prevent the outflow of vital tech talent to the mainland. According to a notice seen by Nikkei Asia, the Labor Ministry said that all Taiwanese and foreign staffing companies on the island as a general rule may no longer post openings for jobs located in China, especially those involving critical industries such as integrated circuits and semiconductors. Taiwan's government on April 28th accused China of waging economic warfare against the Chinese-claimed island's tech sector by stealing technology and enticing away engineers, as parliament considers strengthening legislation to prevent this. Taiwan is home to a thriving and world-leading semiconductor industry, used in everything from fighter jets to cars, and the government has long worried about China's efforts to copy that success, including by industrial espionage and other underhand methods. Four Taiwanese lawmakers from the ruling Democratic Progressive Party are leading a proposal to amend the commercial secrets law to widen the scope of what is considered a secret and toughen penalties. Taiwan's Economy Ministry, in its report, said China was trying to boost its semiconductor industry by "poaching" Taiwanese talent "as well as obtaining our country's industry's commercial secrets, to harm the country's competitiveness". In recent weeks, China has increased military pressure on Taiwan by conducting aircraft carrier drills near the island. China claims Taiwan as its territory and has historically not shied from advocating taking it by force. (With inputs from agencies)

Economic warfare against tech sector: Taiwan bans recruitment for jobs in China to combat brain drain

Taiwan's government on Wednesday accused&nbsp;China&nbsp;of waging economic warfare against the Chinese-claimed island's tech sector by stealing technology and enticing away engineers, as parliament considers strengthening legislation to prevent this.

Taiwan is home to a thriving and world-leading semiconductor industry, used in everything from fighter jets to cars, and the government has long worried about&nbsp;China's efforts to copy that success, including by industrial espionage and other underhand methods.

Also read|&nbsp;<a href="https://www.wionews.com/world/taiwans-chip-firms-to-adhere-to-new-us-rules-blacklisting-chinese-entities-377434">Taiwan's chip firms to adhere to new US rules blacklisting Chinese entities</a>

Four Taiwanese lawmakers from the ruling Democratic Progressive Party are leading a proposal to amend the commercial secrets law to widen the scope of what is considered a secret and toughen penalties.

In a report to parliament about the proposed amendments, Taiwan's National Security Bureau blamed&nbsp;China&nbsp;for most cases of industrial espionage by foreign forces discovered in recent years.

"The Chinese Communists' orchestrated theft of technology from other countries poses a major threat to democracies," it said.

"The aim of the Chinese Communists' infiltration into our technology is not only about economic interests, but also has a political intention to make Taiwan poorer and weaker."

Taiwan's Economy Ministry, in its report, said&nbsp;China&nbsp;was trying to boost its semiconductor industry by "poaching" Taiwanese talent "as well as obtaining our country's industry's commercial secrets, to harm the country's competitiveness".

The Cabinet has met many times to work out how to address the problem, the ministry added.

Lawmaker Ho Hsin-chun, one of the legislators who has proposed the amendments, said the need was urgent.

"The infiltration of&nbsp;China's red supply chain is everywhere," she told a parliament committee meeting.

It is not clear when or if the amendments could be passed into law, and the Justice Ministry in its report suggested further discussion of the wording was needed.

Hu Mu-yuan, deputy head of Taiwan's National Security Bureau, expressed broad backing for the measure.

"As long as it's helpful for our country's security and interests, we support it," he said.

(With inputs from agencies)

Taiwan's government on Wednesday accused China of waging economic warfare against the Chinese-claimed island's tech sector by stealing technology and enticing away engineers, as parliament considers strengthening legislation to prevent this.

Taiwan's government on Wednesday accused China of waging economic warfare against the Chinese-claimed island's tech sector by stealing technology and enticing away engineers, as parliament considers strengthening legislation to prevent this. Taiwan is home to a thriving and world-leading semiconductor industry, used in everything from fighter jets to cars, and the government has long worried about China's efforts to copy that success, including by industrial espionage and other underhand methods. Also read| Taiwan's chip firms to adhere to new US rules blacklisting Chinese entities Four Taiwanese lawmakers from the ruling Democratic Progressive Party are leading a proposal to amend the commercial secrets law to widen the scope of what is considered a secret and toughen penalties. In a report to parliament about the proposed amendments, Taiwan's National Security Bureau blamed China for most cases of industrial espionage by foreign forces discovered in recent years. "The Chinese Communists' orchestrated theft of technology from other countries poses a major threat to democracies," it said. "The aim of the Chinese Communists' infiltration into our technology is not only about economic interests, but also has a political intention to make Taiwan poorer and weaker." Taiwan's Economy Ministry, in its report, said China was trying to boost its semiconductor industry by "poaching" Taiwanese talent "as well as obtaining our country's industry's commercial secrets, to harm the country's competitiveness". The Cabinet has met many times to work out how to address the problem, the ministry added. Lawmaker Ho Hsin-chun, one of the legislators who has proposed the amendments, said the need was urgent. "The infiltration of China's red supply chain is everywhere," she told a parliament committee meeting. It is not clear when or if the amendments could be passed into law, and the Justice Ministry in its report suggested further discussion of the wording was needed. Hu Mu-yuan, deputy head of Taiwan's National Security Bureau, expressed broad backing for the measure. "As long as it's helpful for our country's security and interests, we support it," he said. (With inputs from agencies)

Taiwan accuses China of waging economic warfare against tech sector

The United States on Thursday said that Taiwan is its&nbsp;natural partner&nbsp;when it comes to semiconductors and promoting this cooperation is a priority.

Washington has increasingly viewed tech-powerhouse and democratically ruled Taiwan as a key part of its strategy to shift global supply chains away from China, especially when it comes to technology and chip companies.

Speaking at the groundbreaking ceremony for a new chip fabrication plant for Powerchip Semiconductor Manufacturing Corp in central Taiwan, Brent Christensen, director of the American Institute in Taiwan (AIT), said he was there "to restate the US&nbsp;government's focus on supply chain security".

Also read|&nbsp;<a href="https://www.wionews.com/world/us-to-continue-assisting-taiwans-self-defence-capabilities-says-white-house-369156">US to continue assisting Taiwan's self-defence capabilities, says White House&nbsp;</a>

"Both President Biden and President&nbsp;Tsai&nbsp;have rightly identified the semiconductor industry as a key strategic priority, not only for economic innovation, but also national security," he said, according to a transcript of his comments provided by his office.

Christensen pointed to last year's launch of the US-Taiwan Economic Prosperity Partnership Dialogue as a way the two can "build a coalition to counter the PRC's unfair economic and investment policies", referring to the People's Republic of China.

"The United States and Taiwan are the globe's most natural partners in the semiconductor supply chain with an abundance of companies across the value chain, and it will continue to be an AIT priority to support this cooperation."

Taiwan President&nbsp;Tsai, attending the same event, said she would guarantee that the government will fully support the development of the semiconductor industry, describing it as a "mountain range protecting the country".

Taiwan's central role in producing chips has shot into focus during the COVID-19 pandemic, with soaring demand for laptops, tablets and other equipment to power the work-from-home trend benefiting firms like Taiwan Semiconductor Manufacturing Co Ltd (TSMC), the world's largest contract chipmaker.

Foreign governments and companies have also beseeched Taiwan to help resolve a shortage of auto chips which have idled factories around the world.

US&nbsp;companies are not standing still either, and this week Intel Corp announced a $20 billion plan to expand its advanced chip manufacturing capacity.

The United States on Thursday said that Taiwan is its natural partner when it comes to semiconductors and promoting this cooperation is a priority. Washington has increasingly viewed tech-powerhouse and democratically ruled Taiwan as a key part of its strategy to shift global supply chains away from China, especially when it comes to technology and chip companies.

The United States on Thursday said that Taiwan is its natural partner when it comes to semiconductors and promoting this cooperation is a priority. Washington has increasingly viewed tech-powerhouse and democratically ruled Taiwan as a key part of its strategy to shift global supply chains away from China, especially when it comes to technology and chip companies. Speaking at the groundbreaking ceremony for a new chip fabrication plant for Powerchip Semiconductor Manufacturing Corp in central Taiwan, Brent Christensen, director of the American Institute in Taiwan (AIT), said he was there "to restate the US government's focus on supply chain security". Also read| US to continue assisting Taiwan's self-defence capabilities, says White House "Both President Biden and President Tsai have rightly identified the semiconductor industry as a key strategic priority, not only for economic innovation, but also national security," he said, according to a transcript of his comments provided by his office. Christensen pointed to last year's launch of the US-Taiwan Economic Prosperity Partnership Dialogue as a way the two can "build a coalition to counter the PRC's unfair economic and investment policies", referring to the People's Republic of China. "The United States and Taiwan are the globe's most natural partners in the semiconductor supply chain with an abundance of companies across the value chain, and it will continue to be an AIT priority to support this cooperation." Taiwan President Tsai, attending the same event, said she would guarantee that the government will fully support the development of the semiconductor industry, describing it as a "mountain range protecting the country". Taiwan's central role in producing chips has shot into focus during the COVID-19 pandemic, with soaring demand for laptops, tablets and other equipment to power the work-from-home trend benefiting firms like Taiwan Semiconductor Manufacturing Co Ltd (TSMC), the world's largest contract chipmaker. Foreign governments and companies have also beseeched Taiwan to help resolve a shortage of auto chips which have idled factories around the world. US companies are not standing still either, and this week Intel Corp announced a $20 billion plan to expand its advanced chip manufacturing capacity.

'Natural partners': US says promoting chip cooperation with Taiwan is priority