Taiwan was the largest consumer of semiconductor materials in the world for the seventh consecutive year in 2016 with a total procurement amount of nearly US$9.8 billion, registering an increase of US$370 million from the previous year, according to a report released April 3 by the U.S.-based Semiconductor Equipment and Materials Institute.
SEMI attributed Taiwan’s top ranking and its 3.9 percent annual increase in purchases of semiconductor materials last year to the country’s large foundry and advanced packaging base. South Korea, Japan and mainland China trailed behind Taiwan in that order.
The value chain of the semiconductor industry is composed of three segments, namely integrated circuit design, manufacturing, and packaging and testing. Taiwan Semiconductor Manufacturing Co., headquartered in the northern city of Hsinchu, is the world’s largest dedicated IC foundry, while Advanced Semiconductor Engineering Inc., based in the southern city of Kaohsiung, is the largest IC packaging and testing services provider.
SEMI data revealed that the global semiconductor materials market posted an annual increase of 2.4 percent last year to reach US$44.3 billion in sales with total wafer fabrication materials and packaging materials amounting to US$24.7 billion and US$19.6 billion, respectively.
In addition, global semiconductor revenues increased 1.1 percent year on year in 2016. Annual revenue growth was the strongest in mainland China, Taiwan and Japan, the SEMI report said.
Meanwhile, statistics compiled by the Republic of China (Taiwan) Ministry of Finance showed that IC products accounted for 30.7 percent of the nation’s total exports in 2016, a new high and nearly double the 15.2 percent recorded in 2005. The semiconductor industry’s large share of Taiwan’s exports, however, also reflects the need for more industrial diversification, according to the MOF.
To help maintain the momentum of Taiwan’s growth, the government is gearing up to implement structural reforms to overhaul the country’s industries, review existing laws and regulations governing investment and talent recruitment, as well as fast-track infrastructure development.
One important policy is President Tsai Ing-wen’s five-plus-two innovative industries initiative, which covers the biotech and pharmaceuticals, green energy, national defense, smart machinery and Internet of Things sectors, as well as the circular economy and a new paradigm for agricultural development. (KH-E)
Write to Taiwan Today at ttonline@mofa.gov.tw