INTERVIEW/Taiwan to step up cooperation with Czechia on semiconductors: Official

Taipei, Sept. 9 (CNA) Taiwan plans to strengthen cooperation with the Czech Republic in semiconductor development due to Prague's pivotal role in the European IC industry, Executive Yuan Secretary-General Kung Ming-hsin (龔明鑫) has said.

At a time when Taiwan Semiconductor Manufacturing Co. (TSMC) is building a wafer fab in Dresden, Germany, a Germany-Czechia-Poland silicon triangle is forming, Kung said in an interview with CNA over the weekend, after he returned from a visit to Prague at the end of August.

"The distance between Prague and Dresden is shorter than that between Berlin (Germany's capital city) and Dresden, so Taiwan is expected to take advantage of such a geographic proximity," Kung said.

"Moreover, Taiwan and Prague have already launched direct flights and it is convenient for Taiwanese firms to fly one to two hours from Prague to Dresden."

Thanks to TSMC's investments in Germany, Taiwan's semiconductor investors will be able to build an industrial cluster in Czechia, Kung said.

"I am upbeat that Czechia will serve as a springboard for Taiwan's semiconductor industry to penetrate the European market," he said.

On Aug. 20, TSMC broke ground on a 12-inch wafer fab in Dresden through a joint venture called European Semiconductor Manufacturing Co. (ESMC), which includes Robert Bosch GmbH, Infineon Technologies AG, and NXP Semiconductors N.V.

Construction of TSMC's new facility will start later this year with production scheduled to begin at the end of 2027.

Total investment is estimated to top 10 billion euros (US$11.1 billion) with TSMC taking a 70 percent stake and each of its three partners taking 10 percent. The European Union Commission has approved 5 billion euros in subsidies to the project under the EU Chips Act.

Meanwhile, Taiwan's Ministry of Economic Affairs (MOEA) is planning to set up a service office in Czechia to provide Taiwanese investors the necessary assistance to set up a foothold in Europe.

In the interview, Kung, who took the helms as the Executive Yuan's secretary-general on May 20, said it was the third time for him to visit Czechia since 2021.

That year Kung was the head of the National Development Council (NDC), the top economic planning body in Taiwan, and he led a 66-member delegation to Central Europe.

That trip included a visit to Prague and both sides signed multiple memoranda of understanding (MOU) on industrial cooperation, according to Kung.

In 2023, Kung visited Czechia again to iron out details about the cooperation.

During that second trip to Czechia, Kung marked a map with a circle during a meeting to show the close proximity between Dresden and Prague after TSMC announced its Germany investment plan earlier that year. He said Taiwanese semiconductor suppliers aimed to build a large cluster in Czechia.

This time in his third visit at the end of August, the Taiwanese delegation was comprised of officials across government agencies such as the NDC, the MOEA, and the National Science and Technology Council, as well as representatives from 16 semiconductor firms.

"Many Taiwanese companies have sensed the importance of Czechia, where they are seeing business opportunities arising," Kung said. "They appeared more and more interested in going to Czechia."

In addition to Prague, Kung said the delegation also visited other Czech cities such as Brno, which is well known for its technology and academic development. AI server Wistron Corp. runs a facility in Brno.

Kung's delegation also went to Kutná Hora, where iPhone assembler Hon Hai Precision Industry Co. set up a complex in 2000, and Ústecký kraj, which is just a 40-minute drive to Dresden and is expected to become a top destination for Taiwanese semiconductor firms.

Kung said as TSMC's facility in Germany will not begin operations until the end of 2027, it is not urgent for interested Taiwanese semiconductor firms to build plants at the moment.

Instead, Kung advised, they should set up offices or build logistics facilities first.

He said the government will try hard to coordinate resources owned by Taiwanese investors and not leave them to do it on their own in a foreign market.

Kung also said that Taiwan's government welcomes students from Germany and other countries to come to Taiwan to study semiconductor and related fields by providing scholarships.

Through cooperation among the government, industries and academics, Kung said, Taiwan aims to build a large semiconductor talent pool by attracting these foreign students to stay in Taiwan after they finish their study programs.

Even if students from Europe decide to go home, they are likely to work for TSMC or other Taiwanese firms in the semiconductor supply chain in Europe, Kung said.

"Taiwan and Czechia have shared values of democracy and freedom," and based on this foundation, both sides are expected to continue to work with each other in industrial development and set sights on the European market, he said.