Taiwan's Minister of Economic Affairs Speaks Ahead of Legislative Appearance
"TSMC and GlobalWafers Have Received US Support"
Further Assessment of Impact... Intention to Be Clarified
The Taiwanese government has announced that it will enter into further consultations to prepare for the possibility that the Donald Trump administration in the United States may demand equity stakes from semiconductor companies such as Taiwan's TSMC and South Korea's Samsung Electronics in exchange for subsidies.
The Taipei Times reported on the 21st that Taiwan's Minister of Economic Affairs, Kuo Tzu-hui, said at a press conference held ahead of his appearance before the Legislative Yuan's Economic Committee that he would assess the situation regarding TSMC.
The newspaper stated that Minister Kuo explained both TSMC and GlobalWafers have received support from the United States, and that Taiwan would proceed with additional consultations to prepare for the possibility that the US might request equity participation.
Regarding concerns that the US government could attempt to join the board of directors or interfere in management after acquiring shares, Minister Kuo said, "It is necessary to confirm the impact and seek expert evaluations," adding, "If the US government wants to become a TSMC shareholder through investment, it must undergo a review by the Investment Review Committee of the Ministry of Economic Affairs."
In addition, the Ministry of Economic Affairs stated that it would work together with the National Development Council (NDC), TSMC's largest shareholder with a 6.38% stake, to analyze any 'hidden' implications.
Previously, Reuters reported on the 19th that US Secretary of Commerce Howard Lutnick is considering a plan for the US government to receive equity stakes in companies building factories in the United States with support under the CHIPS Act.
Reuters explained that this is an expansion of the US government's plan to receive a 10% stake in domestic company Intel in exchange for subsidies, and that this would apply to companies such as Taiwan's TSMC, US-based Micron, and South Korea's Samsung Electronics.
Minister Kuo noted, "Washington's plan to invest in company equity is similar to the way the Chinese government holds stakes in companies," and added that it is noteworthy that the US, which has long opposed such practices, is now attempting a new approach.
The Chinese government has exerted influence over private big tech companies such as Alibaba and Tencent by having state-owned funds or party-affiliated institutions acquire stakes or hold 'golden shares' (special voting shares). In key sectors of the economy such as energy, finance, telecommunications, and infrastructure, it exercises control by directly operating state-owned enterprises.
The Liberty Times reported that as of the second quarter of this year, TSMC has 2.36 trillion Taiwan dollars (approximately 108.3 trillion won) in immediately available cash assets, and that even without the 6.6 billion dollar (about 9.2 trillion won) subsidy for factory construction, there would be no problem with building its US plant.
However, the South Korean government maintains that such foreign media reports are "groundless." Presidential spokesperson Kang Yoo-jung stated at a briefing that afternoon, "It is said that, like US company Intel, subsidies would be converted into shares, but as far as we know, no Korean company has yet received any subsidies."
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