Taiwan Proposes Partnership With EU to Boost Chips Cooperation

Taiwan President Lai Ching-te speaks at the annual Taiwan-EU investment forum in Taipei, Taiwan, on Nov. 18, 2024. Ann Wang/Reuters

Taiwan President Lai Ching-te called for a trade deal with the European Union (EU), which he said would allow for the two parties to cooperate on critical semiconductor technology, during the annual EU Investment Forum in Taiwan on Nov. 18.

“Looking to the future, Taiwan hopes to take an innovative approach towards the signing of an economic partnership agreement with the EU,” Lai said. “This would not only make both our economies more resilient and secure but also ensure the stable operation of global supply chains.”

Lai brought up the threats Taiwan faces from the Chinese communist regime, which views the democratic self-ruled island nation as its own territory. Taiwan needs democratic partners, said Lai, who has been pushing for investment and trade deals.

The Chinese Communist Party, which has never ruled Taiwan, has been vocal about not wanting other nations to deal with Taiwan as a sovereign nation or risk their ties with China. As a result, Taiwan is often excluded from formal recognition in global agreements. China is the EU’s second-largest trading partner.

The EU has wanted to bring Taiwan into the European Chips Act to boost semiconductor manufacturing in Europe, and Lai suggested this may be possible if the EU were to sign an economic deal with Taiwan. Taiwan is home to the world’s leading chipmakers, the only manufacturers capable of producing the smallest, most advanced chips.

Maria Martin-Prat, deputy head of the European Commission’s directorate-general for trade, praised bilateral relations in a video message to the investment event, without mentioning signing such a deal with Taiwan.

“Taiwan, a vibrant democracy with an open economy, is a trusted partner for us to promote our economic security,” she said.

In Europe, TSMC, the Taiwanese semiconductor manufacturer that’s the largest in the world, currently has a joint venture with the European Semiconductor Manufacturing Company (ESMC) to build a fabrication plant in Dresden, Germany, with TSMC owning the majority share.

According to a company statement, the project received strong support from both the EU and the German government. At full capacity, it is projected to produce 40,000 wafers monthly. Production is slated to begin in 2027.

In 2023, Taiwan signed trade deals with the United States, Canada, and the UK, which the Chinese regime has opposed.

Taiwan has also applied to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), an 11-member trade agreement among countries in the Pacific region. The trade deals it secured last year are seen as a sign that Taiwan may have a path to join.

Canada is set to assume the rotating chair of the CPTPP next year.

Andrew Chen and Reuters contributed to this report.