What is Taiwan afraid of?
Taiwan fears that if these top engineers are being taken to China, they will also take some trade secrets with them. This could harm Taiwan’s economy. According to Eric Yi-Hung Chiu, an associate professor of international relations at the National Yang Ming Chiao Tung University in Taipei, semiconductors accounted for around 35 percent of Taiwan’s total exports in 2020. For this reason, China is now offering Taiwanese engineers to work for their country by forming shell companies.
Taiwan will make strict laws to prevent brain drain
In view of this brain drain, Taiwan’s cabinet had proposed to strengthen the country’s national security law. Its purpose was to prevent the exit of Taiwan’s trade secrets and to impose harsher punishment for anti-national crimes, including economic espionage. Under the proposed amendments, the convicts of such offenses could be jailed for 10 to 12 years. In addition, a fine ranging from $1 million to $3.5 million can also be imposed.
Millions of fines will be imposed on Chinese companies
The main goal of this amendment is to target Chinese companies that are exploiting Taiwan’s technology and people. In such a case, Taiwanese companies acting as masks for Chinese firms will face fines of up to $860,000. Whereas, Chinese companies operating in Taiwan without authorization can be fined up to $500,000. Not only this, the top executives of these companies can also be jailed for three years.
Taiwan produces more than half of the world’s semiconductors
Taiwan’s semiconductor manufacturing company TSMC alone produces more than half of the world’s semiconductors. They are used everywhere from smartphones and medical devices to cars and fighter jets. Taiwan’s Prime Minister Su Tseng-chang described semiconductor manufacturing as the country’s lifeline. But now China’s red supply chain is rapidly infiltrating it.